Technology usually creates jobs for young, skilled workers. Will AI do the same?

At any given time, technology does two things to employment: It replaces traditional jobs, and it creates new lines of work. Machines replace farmers, but enable, say, aeronautical engineers to exist. So, if tech creates new jobs, who gets them? How well do they pay? How long do new jobs remain new, before they become just another common task any worker can do?A new study of U.S. employment led by MIT labor economist David Autor sheds light on all these matters. In the postwar U.S., as Autor and his colleagues show in granular detail, new forms of work have tended to benefit college graduates under 30 more than anyone else. “We had never before seen exactly who is doing new work,” Autor says. “It’s done more by young and educated people, in urban settings.” The study also contains a powerful large-scale insight: A lot of innovation-based new work is driven by demand. Government-backed expansion of research and manufacturing in the 1940s, in response to World War II, accounted for a huge amount of new work, and new forms of expertise. “This says that wherever we make new investments, we end up getting new specializations,” Autor says. “If you create a large-scale activity, there’s always going to be an opportunity for new specialized knowledge that’s relevant for it. We thought that was exciting to see.” The paper, “What Makes New Work Different from More Work?” is forthcoming in the Annual Review of Economics. The authors are Autor; Caroline Chin, a doctoral student in MIT’s Department of Economics; Anna M. Salomons, a professor at Tilburg University’s Department of Economics and Utrecht University’s School of Economics; and Bryan Seegmiller PhD ’22, an assistant professor at Northwestern University’s Kellogg School of Management.And yes, learning about new work, and the kinds of workers who obtain it, might be relevant to the spread of artificial intelligence — although, in Autor’s estimation, it is too soon to tell just how AI will affect the workplace.“People are really worried that AI-based automation is going to erode specific tasks more rapidly,” Autor observes. “Eroding tasks is not the same thing as eroding jobs, since many jobs involve a lot of tasks. But we’re all saying: Where is the new work going to come from? It’s so important, and we know little about it. We don’t know what it will be, what it will look like, and who will be able to do it.”“If everyone is an expert, then no one is an expert”The four co-authors also collaborated on a previous major study of new work, published in 2024, which found that about six out of 10 jobs in the U.S. from 1940 to 2018 were in new specialties that had only developed broadly since 1940. The new study extends that line of research by looking more precisely at who fills the new lines of work. To do that, the researchers used U.S. Census Bureau data from 1940 through 1950, as well as the Census Bureau’s American Community Survey (ACS) data from 2011 to 2023. In the first case, because Census Bureau records become wholly public after about 70 years, the scholars could examine individual-level data about occupations, salaries, and more, and could track the same workers as they changed jobs between the 1940 and 1950 Census enumerations. Through a collaborative research arrangement with the U.S. Census Bureau, the authors also gained secure access to person-level ACS records. These data allowed them to analyze the earnings, education, and other demographic characteristics of workers in new occupational specialties — and to compare them with workers in longstanding ones.New work, Autor observes, is always tied to new forms of expertise. At first, this expertise is scarce; over time, it may become more common. In any case, expertise is often linked to new forms of technology.“It requires mastering some capability,” Autor says. “What makes labor valuable is not simply the ability to do stuff, but specialized knowledge. And that often differentiates high-paid work from low-paid work.” Moreover, he adds, “It has to be scarce. If everyone is an expert, then no one is an expert.”By examining the census data, the scholars found that back in 1950, about 7 percent of employees had jobs in types of work that had emerged since 1930. More recently, about 18 percent of workers in the 2011-2023 period were in lines of work introduced since 1970. (That happens to be roughly the same portion of new jobs per decade, although Autor does not think this is a hard-and-fast trend.) In these time periods, new work has emerged more often in urban areas, with people under 30 benefitting more than any other age category. Getting a job in a line of new work seems to have a lasting effect: People employed in new work in 1940 were 2.5 times as likely to be in new work in 1950, compared to the general population. College graduates were 2.9 percentage points more likely than high school graduates to be engaged in new work. New work also has a wage premium, that is, better salaries on aggregate than in already-existing forms of work. Yet as the study shows, that wage premium also fades over time, as the particular expertise in many forms of new work becomes much more widely grasped. “The scarcity value erodes,” Autor says. “It becomes common knowledge. It itself gets automated. New work gets old.”After all, Autor points out, driving a car was once a scarce form of expertise. For that matter, so was being able to use word-processing programs such as WordPerfect or Microsoft Word, well into the 1990s. After a while, though, being able to handle word-processing tools became the most elementary part of using a computer.Back to AI for a minuteStudying who gets new jobs led the scholars to striking conclusions about how new work is created. Examining county-level data from the World War II era, when the federal government was backing new manufacturing in public-private partnerships throughout the U.S., the study shows that counties with new factories had more new work, and that 85 to 90 percent of new work from 1940 to 1950 was technology-driven. In this sense there was a great deal of demand-driven innovation at the time. Today, public discourse about innovation often focuses on the supply side, namely, the innovators and entrepreneurs trying to create new products. But the study shows that the demand side can significantly influence innovative activity. “Technology is not like, ‘Eureka!’ where it just happens,” Autor says. “Innovation is a purposive activity. And innovation is cumulative. If you get far enough, it will have its own momentum. But if you don’t, it’ll never get there.”Which brings us back to AI, the topic so many people are focused on in 2026. Will AI create good new jobs, or will it take work away? Well, it likely depends how we implement it, Autor thinks. Consider the massive health care sector, where there could be a lot of types of tech-driven new work, if people are interested in creating jobs.“There are different ways we could use AI in health care,” Autor says. “One is just to automate people’s jobs away. The other is to allow people with different levels of expertise to do different tasks. I would say the latter is more socially beneficial. But it’s not clear that is where the market will go.” On the other hand, maybe with government-driven demand in various forms, AI could get applied in ways that end up boosting health care-sector productivity, creating new jobs as a result. “More than half the dollars in health care in the U.S. are public dollars,” Autor observes. “We have a lot of leverage there, we can push things in that direction. There are different ways to use this.” This research was supported, in part, by the Hewlett Foundation, the Google Technology and Society Visiting Fellows Program, the NOMIS Foundation, the Schmidt Sciences AI2050 Fellowship, the Smith Richardson Foundation, the James M. and Cathleen D. Stone Foundation, and Instituut Gak.