A new study led by MIT labor economist David Autor reveals that technological innovation typically creates new job categories that primarily benefit young, educated workers in urban areas. However, as artificial intelligence (AI) advances, its impact on future employment remains uncertain.
The research analyzed U.S. Census Bureau data spanning from 1940 to 1950 and recent American Community Survey data from 2011 to 2023. The findings show about 7 percent of workers in 1950 held jobs in new specialties that had emerged since 1930, while around 18 percent of workers today are employed in occupations introduced since 1970. New types of work generally offer a wage premium initially, although this advantage diminishes over time as the specialized skills become widespread and automated.
New Work Benefits Young, Educated Workers
The study highlights that new job formations are concentrated in urban settings and disproportionately occupied by workers under 30 years old with college degrees. Individuals engaged in new work in 1940 were 2.5 times more likely to remain in new occupations ten years later, and college graduates were nearly 3 percentage points more likely than high school graduates to hold emerging jobs. This underscores the importance of specialized knowledge and education in accessing newly created roles.
Demand-Driven Innovation and AI’s Role
By examining World War II-era county-level data, the study found that government-backed investments in manufacturing and research significantly spurred new job creation, with 85 to 90 percent of new occupations from 1940 to 1950 driven by technology. This illustrates how demand-side factors often catalyze innovation and labor specialization.
Regarding AI, Autor notes it is still too soon to know whether AI will primarily automate tasks or create new specialized roles. He points to health care as an example where AI could either eliminate jobs or enable workers with varying expertise levels to perform novel tasks if guided by deliberate investment and policy. Since public funding constitutes over half of U.S. health care spending, government decisions could influence whether AI adoption leads to job growth or reduction.
Why it matters
This research offers context for policymakers and industry leaders navigating AI’s widespread adoption, highlighting the importance of education, urban job markets, and demand-driven innovation in fostering new employment opportunities. Understanding who benefits from technology-induced job shifts can inform strategies to support workforce transitions and equitable growth.
Background
The study builds on earlier work by the same authors showing that approximately 60 percent of U.S. jobs since 1940 have been in new occupations. It offers a rare detailed look into the demographics and earnings of workers in these new fields. The research underscores that new roles often require scarce, specialized knowledge initially before becoming normalized over time, paralleling historical shifts seen with the adoption of technologies like automobile driving and word processing.
The paper, “What Makes New Work Different from More Work?”, will be published in the Annual Review of Economics and was supported by several foundations including the Hewlett Foundation and Google’s Technology and Society Visiting Fellows Program.
Sources
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