Lost in the proverbial shuffle Thursday: What might’ve been the first A.I. cameo in a notable labor market data series.
Not surprisingly, the latest Challenger job cuts data showed announcements jumped almost 290% last month compared to May of 2022. Some 81,000 new announced cuts brought the YTD running total to 417,500, up 315% YoY.
For reference, companies announced around twice as many cuts during the first five months of 2009, when stocks were busy finding a bottom and embarking on the first leg of what would end up being the greatest bull market of all time.
Tech companies accounted for more than 25% of May’s announced cuts, and are up nearly 3,000% YTD.
But the real standout from the latest Challenger Gray & Christmas report was the “reasons” table, which now includes A.I.
A.I. cost more human jobs in May than M&A, company contract losses, outsourcing to other US companies, financial difficulties, slower demand, COVID and bankruptcies (individually, not combined).
It’s a watershed moment of sorts: Humans are now tracking A.I.-related job losses which, depending on who you listen to, could run into the hundreds of millions globally over time.
Looking back at history, the advent of new technology tends to create more jobs than it replaces.
The figure above from Goldman shows that new, technology-enabled occupations can comprise the majority of employment growth.
But human beware: A.I. is a different sort of technology. Past might not be precedent. Or at least according to so-called A.I. “doomers,” a category which disconcertingly includes some industry leaders barreling ahead with development and deployment.
As discussed here earlier this week, the juxtaposition between warning on the potential for A.I. to bring about an extinction event for humanity and pursuing A.I. development at a breakneck pace suggests some industry heavyweights are suffering from severe cognitive dissonance.
In any event, according to Challenger Gray & Christmas, 3,900 of May’s 80,089 announced job cuts were attributable to A.I. I suppose this means we’ll be able to track the percentage of monthly layoffs blamed on A.I. going forward.
Related: 18% Of Global Employment Could Be Replaced By Generative AI, Goldman Says
