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Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]
- majormajor 1y agoLLMs are very useful tools for software development, but focusing on employment does not appear to really dig into if it will automate or augment labor (to use their words). Behaviors are changing not just because of outcomes but because of hype and expectations and b2b sales. You'd expect the initial corporate behaviors to look much the same whether or not LLMs turn into fully-fire-and-forget employee-replacement tools. Some nits I'd pick along those lines: >For instance, according to the most recent AI Index Report, AI systems could solve just 4.4% of coding problems on SWE-Bench, a widely used benchmark for software engineering, in 2023, but performance increased to 71.7% in 2024 (Maslej et al., 2025). Something like this should have the context of SWE-Bench not existing before November, 2023. Pre-2023 systems were flying blind with regard to what they were going to be tested with. Post-2023 systems have been created in a world where this test exists. Hard to generalize from before/after performance. > The patterns we observe in the data appear most acutely starting in late 2022, around the time of rapid proliferation of generative AI tools. This is quite early for "replacement" of software development jobs as by their own prior statement/citation the tools even a year later, when SWE-Bench was introduced, were only hitting that 4.4% task success rate. It's timing lines up more neatly with the post-COVID-bubble tech industry slowdown. Or with the start of hype about AI productivity vs actual replaced employee productivity.
- eru 1y agoYes, even if the underlying AI stops advancing today, it will take a while for the economy to digest and adjust to the new systems. Eg a lot of the improvements in usefulness in the last few quarters came from better tooling, not necessarily better models. But with progress continuing in the models, too, it's an even more complicated affair.
- trhway 1y agoOffshoring was similar - i.e. companies discovered that expensive labor here can be performed inexpensively there while senior laborers/PMs here would perform the overseeing role - and we can look at it how long it took to digest it and adjust to it. While 15-20 years ago it was all the rage, today it is just an established well understood and efficiently utilized, where applicable, practice.
- eru 1y agoYes. However it wasn't just noticing the difference in wages. That had been known since forever and didn't wake a genius. Figuring out how to produce efficiently in the cheaper places and get the goods to rich markets took more smarts and experimentation. Container shipping played a big role in that, and so did modern communication and cheaper flights.
- ath3nd 1y ago> LLMs are very useful tools for software development That's an opinion many disagree with. As a matter of fact, the only limited study up to date showed that LLMs usage decrease productivity for experienced developers by roughly 19%. Let's reserve opinions and link studies. https://metr.org/blog/2025-07-10-early-2025-ai-experienced-os-dev-study/ https://metr.org/blog/2025-07-10-early-2025-ai-experienced-o... My anecdotal experience, for example, is that LLMs are such a negative drain on both time and quality that one has to be really early in their career to benefit from their usage.
- yakshaving_jgt 1y agoI’m 15 years into my career and I write Haskell every day. I’m getting a massive productivity boost from using an LLM.
- deleted 1y ago[deleted]
- black_knight 1y agoHow do you find the quality of the Haskell code produced by LLM? Also, how do you use the LLM when coding Haskell? Generating single functions or more?
- yakshaving_jgt 1y agoI'm stuck in my ways with vim/tmux/ghci etc, so I'm not using some AI IDE. I write stuff into ChatGPT and use the output, copying manually, or writing it myself with inspiration from what I get. I feed it a fair bit of context (like, say, a production module with a load of database queries, and the associated spec module) so that it copies the structure and patterns that I've established. The quality of the Haskell code is about as good as I would have written myself, though I think it falls for primitive obsession more than I would. Still, I can add those abstractions myself after the fact. Maybe one of the reasons I'm getting good results is because the LLM effectively has to argue with GHC, and GHC always wins here. I've found that it's a superpower also for finding logic bugs that I've missed, and for writing SQL queries (which I was never that good at).
- hochstenbach 1y agoOne would expect that if such studies indeed indicate that AI has an effect on early-career workers in AI-exposed occupations, that this would be a global effect. I wonder if there are good comparable non-US studies available.
- moi2388 1y agoAs a non-US citizen, in my EU country we’re still starving for new programmers.
- trhway 1y agoPoland? Sometimes ago i looked up salaries in Warsaw - it were like $10-$20K/month which as i understand is pretty high by EU standards.
- yurishimo 1y agoReally? That's crazy. I'm earning a bit over 5k in the Netherlands. Granted, not Amsterdam, but still.
- trhway 1y agoOur guys in St.Petersburg 20 years ago were pulling $3-6K. Granted the life there comes with some risks and inconveniences :) You're probably working in a domestic company which usually pays less than offshored jobs by a large transnational (and domestics say in Russia were paying significantly less than the offshored). I don't think many companies do significant offshoring into Western Europe though.
- wiz21c 1y agobefore or after taxes ?
- dathinab 1y agoBefore taxes, always before taxes. Comparing salaries between countries with vastly different approaches to taxes, health insurance, living cost, hidden side costs etc. is hard and can easily be hugely misleading. Not even including any subtle things just what "before and after taxes" means can differ. E.g. where I live "after taxes" does for most people not just deduct taxes but also the base health insurance cost and some other things (but to make it more fun, only most but not all people. This means what after tax means can differ between neighbors ). And then there are so many hidden cost which can influence taxes, e.g. in some areas you practically have to have a car this means that in effect the cost of a car isn't that different from a fixed sum tax, if you consider social standards it even scales with income up to a certain point income like most taxes (and cost x10+ if you can't drive a car for health reasons). On the other hand if you live in a area with decent public transportation and then a car is a Luxus good, but someone has to pay for the public transportation, and if you area isn't overrun by well paying tourists this means you likely pay more tax (but as public transportation tends to scale better you still likely save money especially if you aren't wealthy). Anyway so comparing after tax in vastly different countries is IMHO a folly. And even before tax is tricky but you have to choose something. I guess another option is "what to frugal living people with reasonable health insurance and rent have left over at the end of the month" is theoretically the better statistic, but just not practical.
- NitpickLawyer 1y ago> Hard to generalize from before/after performance. While this is true, there are ways to test (open models) on tasks created after the model was released. We see good numbers there as well, so something is generalising there.
- ludicrousdispla 1y agoIt's funny the lengths to which companies will go in order to avoid work.
- godelski 1y agoIt's also funny how much they'll spend to save a few pennies
- wazoox 1y agoWell... > The contest between the capitalist and the wage-labourer dates back to the very origin of capital. It raged on throughout the whole manufacturing period. [112] But only since the introduction of machinery has the workman fought against the instrument of labour itself, the material embodiment of capital. He revolts against this particular form of the means of production, as being the material basis of the capitalist mode of production. > [...] > The instrument of labour, when it takes the form of a machine, immediately becomes a competitor of the workman himself. [116] The self-expansion of capital by means of machinery is thenceforward directly proportional to the number of the workpeople, whose means of livelihood have been destroyed by that machinery. The whole system of capitalist production is based on the fact that the workman sells his labour-power as a commodity. Division of labour specialises this labour-power, by reducing it to skill in handling a particular tool. So soon as the handling of this tool becomes the work of a machine, then, with the use-value, the exchange-value too, of the workman’s labour-power vanishes; the workman becomes unsaleable, like paper money thrown out of currency by legal enactment. Karl Marx, The Capital, Book I Chapter 15. https://www.marxists.org/archive/marx/works/1867-c1/ch15.htm https://www.marxists.org/archive/marx/works/1867-c1/ch15.htm
- dathinab 1y ago> like this should have the context of SWE-Bench not existing before November, 2023. Given the absurdly common mal practice(1) of training LLMs on/for tests i.e. what you could describe as training on the test set any widely used/industry standard test to evaluate LLMs is not really worth half of what it claims it is. (1): Which is at least half intend, but also to some degree accident due to web scrabbling, model cross training etc. having a high chance to accidentally sneak in test data. In the end you have to have your own tests to evaluate agent/LLM performance, and worse you have to not make them public out of fare of scientific malpractice turning them worthless. Tbh. that is a pretty shitty situation.
- adroniser 1y agoThis suggests people should pre-register benchmarks. Because currently it feels like there is little incentive to publish benchmarks that models saturate.
- whatever1 1y agoTo me it seems that LLMs are a tool that only increase productivity for given headcount in dimensions that were neglected in the past. For example, everyone now writes emails with perfect grammar in a fraction of a time. So now the expectation for emails is that they will have perfect grammar. Or one can build an interactive dashboard to visualize their spreadsheet and make it pleasing. Again the expectation just changed. The bar is higher. So far I have not seen productivity increase in dimensions with direct sight to revenue. (Of course there is the niche of customer service, translation services etc that already were in the process of being automated)
- Wololooo 1y agoI'm sad to see this for several reasons because I do not expect or want everyone up use a LLM to converse with me via mail, the whole point is to exchange information, with everyone using a LLM as output and input, now the whole thing becomes a game of telephone. You do not need to build a spreadsheet visualiser tool there are plenty of options that exist and are free and open source. I'm not against advances, I'm just really failing to see what problem was in need of solving here. The only use I can get behind is the translation, which admittedly works relatively well with LLMs in general due to the nature of the work.
- manmademagic 1y agoIt's an interesting dilemma, since if I know that an email was written mostly with AI, it feels to me like the author didn't put effort in, and thus I won't put much effort into reading the email. I had a conversation with my manager about the implications of everyone using AI to write/summarise everything. The end result will most likely be staff getting Copilot to generate a report, then their manager uses Copilot to summarise the report and generate a new report for their manager, ad inifinitum. Eventually all context is lost, busywork is amplified, and nobody gains anything.
- chii 1y ago> Eventually all context is lost, busywork is amplified why not fire everyone in between the top-most manager and the actual "worker" doing the work, as the report could be generated with the correct level of summary?
- monster_truck 1y agoI've got a few buddies over at Microsoft, they've all said something along the lines of "I really hate using copilot. They at least let us use pre-approved models in VSCode, we get most that come out. But all AI metrics are tracked and there are layoffs every quarter. I have kids now man. Strange times. I know you would have quit months ago" and they're right.
- mandeepj 1y agoHopefully they have racked up a few million. https://www.fool.com/investing/2024/11/29/this-magnificent-stock-made-many-millionaires/ https://www.fool.com/investing/2024/11/29/this-magnificent-s...
- indymike 1y agoNow that bs work has next to no cost, I see a lot more bs work being done, and often on pointless bureaucratic activities involving generating questionnaires and answering them. It's as if the activities add up to a big net zero.
- ggm 1y agoAny Board which supports management hollowing out future profits by either firing, or not hiring junior staff deserves to have their bonus rescinded. Think like a forestry investor, not a cash crop next season.
- joshdavham 1y agoIt's going to be extremely interesting to see what the field of software dev will look like in a few years given how few juniors are getting hired recently.
- rsynnott 1y agoSame as a few years after the dot com crash and after the financial crisis (assuming that this is a real phenomenon; I’m not currently convinced); a critical skills shortage. (This isn’t unique to IT; this cyclical underinvest-shortage-panic pattern happens in a lot of industries.)
- camillomiller 1y agoCorporate incentives are usually not pushing in this direction.
- ggm 1y agoThen why are so many corporations reducing staff citing ai?
- ares623 1y agoStonks go up
- camillomiller 1y agoReread the main comment and then mine.
- ggm 1y ago
- softwaredoug 1y agoI think mRNA vaccines and green energy are equally transformative economic opportunities. In the US though we are becoming a one trick pony. Instead of investing in all 3, we will prioritize AI because Silicon Valley sucked up to Trump in the recent election. All to say we could have quite a bit more resilience as an economy, but we decided to sacrifice our leadership in these areas.
- svaha1728 1y agoWorking in microgrids and I completely agree. I use Claude Code every day. There’s so much we don’t know and so much that an LLM is not going to help you with.
- borzi 1y agoThe 10% reduction in hiring for young workers is entirely because industry (software, manufacturing) at least in the united states (and probably the world) is contracting and in recession, while the services and government sector has been the main sector growing since a long time now - completely due to economic and geopolitical reasons, nothing to do with AI.
- baxtr 1y agoYes. And unfortunately (or luckily for some) the end of the low interest and geopolitical changes aligned with the advent of LLMs.
- borzi 1y agoAnd what many people don't notice: interest rates are not high.
- johnfn 1y agoGenuine curiosity: how do you know that software is in a recession? What measures do you use to determine this? And how do you know that the recession is not AI driven? I don't think it is either, but it's more of a feeling; I'm not sure how I would make that argument more grounded.
- sameermanek 1y agoCheck sum of free cash flow of major tech co.s. you'll soon find out that the cash needle of industry as a whole is not moving that much. They are just round tripping the cash that was sitting in their accounts through investments that make their way back through advertising channels or compute channels. Once you see the bigger picture, you'll realise its all just a Fugazi post covid
- borzi 1y agoWell, the best measurement is hiring slowdown and bankruptcies. Bankruptcies in the US are up 13.1%. Traditionally, you wouldn't look at the release of a productivity tool coinciding with a hiring slowdown and assume that it's automation causing the hiring slowdown, your first instinct would be that the sector is not doing well.
- digitcatphd 1y agoI had a team of developers and essentially told them all 'either learn to code with Claude' or you're out. What I found is the more junior developers started 'vibe coding' resulting in a net decrease in performance, where the more senior ones used it to accelerate their speed cautiously and selectively. My conclusion was senior engineers were better because they were used to managing developers and taking on more managerial tasks building 'LLM Soft Skills' and also frankly fixing mistakes, the junior developers were pressured for speed and had their managers to correct them. Within 12 months, despite extensive attempts, only the mid level team members remained.
- bgwalter 1y agoThe senior developers pretended to use Claude Steal to comply with your rude and ignorant request. They are better at programming and the soft skills required to appease an incompetent manager. You just used "AI" to get rid of people you didn't want anyway, but since it was your order it had to be a "success story".
- Etheryte 1y agoThis is literally the difference between a junior or senior though? You could've just as well said to go faster or you're out and you would've gotten the same result. LLMs are irrelevant to what you've done here.
- tkel 1y agomaybe they left because they thought you're an idiot
- ablation 1y agoI think they're probably better off without you, given this story.
- trod1234 1y agoThe problem with your reasoning is that its discriminatory in the parameters you set. When you set impossible constraints that neglect requirements for sustainability, and tell people to do the impossible, you pigeonhole and sieve only the people you are actually looking for (the ones that can meet that sieve). The lying, and deceit that you do, naturally occur after-the-fact (which blind people don't notice, often making them evil). The danger of most deceit and lying occur where you say something truthful omitting something important that they know, but then later contradict yourself in the outcome. These are called lies of omission. Deceivers and Vipers take full effect of these actions pretending its not them, its the circumstance, but a circumstance they control. Of course the middle team would be the only ones left, after all you tortured your senior team having them baby a LLM driving them to burnout, and the junior team lacked the knowledge that makes the difference between Junior and Mid, to be productive. You set a filter that only your midlevel team could meet, and any conclusions you make will equally conform to your initial decisions in the criteria you set which is you don't want to hire young people, or old people. You want them just right, and there are laws against age discrimination. People have tried to get around these laws for years, and have never had more luck in evading these than now; with the advent of blackbox AI which can obscure these type of decisions through hiding them in the weights. Short term, there will of course be more profit, long-term the lawsuits will get you, and your good character which you thought you had will not be good. Additionally, you have your perfect team left that is wholly dependent on LLM, who won't be able to solve the rare but inevitable problems the senior level people would (before they occur).
- user94wjwuid 1y agoIs 2 years or so big enough sample size for any conclusions? You’re also seeing massive money movements; last quarter larger than consumer spending (!!!) This money isn’t going to junior head counts(labor), it’s going to compute(capital) Also what’s everyone’s balance sheet really saying? Will this money movement to capital rather than labor ACTUALLY pay off ? I think that would take a 10year hind sight to prove no?
- TomMasz 1y ago>early-career workers (ages 22-25) in the most AI-exposed occupations have experienced a 13 percent relative decline in employment even after controlling for firm-level shocks. As a professor of software engineering, I'm feeling an existential crisis coming on. Are we preparing students in vain? Last term was the first time I had senior project students who didn't have a job lined up in the Fall of their final year. Maybe it's time to retire.
- bgwalter 1y agoI would say it's time to fight back. Politicians need to be educated that "AI" is plagiarism and is used as an excuse to scale back the workforce. It also ruins the thriving intellectual landscape. Since you are a professor, they might listen to you.
- adroniser 1y agodidn't hackers used to be for piracy?
- whamlastxmas 1y agoYeah the corporate bootlicking around all of this is weird. We’ve hated patent trolls and Disney’s abuse/corruption of the copyright system and record label lawsuits, but suddenly intellectual property is great?
- bgwalter 1y agoGeneric piracy is for example distributing a commercial unmodified video with full attribution. You don't normally create a derivative work. Plagiarism is training on generously licensed open source software and creating a derivative work without attribution. Not all hackers were in favor of piracy, the majority of open source hackers have always been pretty protective of their licenses, which were written before the existence of the laundromats. Taking all IP and using it against its creators is entirely new and does not match the piracy issues.
- keeda 1y ago
- bsenftner 1y agoI'm curious what percentage of the "tech industry" is in fact the classic dumb money, and what they have their developers doing is basically fantasy nonsense for the owner(s). I know of several very good sized tech companies, purchased by Saudi Princes, for nothing other than their bragging rights and their staff are an odd mix of their friends, the original tech team, and then an odd series of fantasy vanity projects. Remember 15 years ago when mounting cameras on a person's face for "face captures" during gameplay was a thing? Several of those companies are now Saudi playpens, with over worked developers making demos on deadlines that are just for bragging rights and not products at all.
- rsanek 1y agoThe first figure alone is insane, for me it helps explain why some friends feel like the market has fallen out from under them (early career) while others aren't having such a tough time. It seems like so far, for folks 30+ AI hasn't really changed things radically (yet). The series in figure 6, though, I think suggests that we may just be seeing a time-delayed effect and eventually everyone's going to be impacted.
- lelanthran 1y ago> The first figure alone is insane, for me it helps explain why some friends feel like the market has fallen out from under them (early career) while others aren't having such a tough time. It seems like so far, for folks 30+ AI hasn't really changed things radically (yet). Not just early career, also independent devs who are any from early-career to late-career. I did a thing for a client a few weeks ago (embedded, with prototype board + code for industrial sensor containing multiple sensor types, using wifi to both configure and monitor the device, and to retrieve sensor values). They balked at a two-week bill; their argument was that this should have not been more than a 2-day bill (literally, 2 days for everything from soldering up the prototype board to writing the code). Their frame-of-reference was that their in-house dev (or similar, not sure now) could do that in two days with an arduino or ESP32 devkit. My suspicion is that because their in-house dev took only two days to get claude code to write a ping program for a esp32 dev board (no soldering, sensors, etc. Purely WiFi comms and nothing else), their expectations were that this should have been the same. (I eventually accepted the payment for only 2 days worth of dev, of which at least half was expenses for me - driving, meetings with them, purchases, etc.)
- trod1234 1y agoIt is good that people are paying attention to this problem, but unfortunately not in time to correct the problem before consequences get bad. Hysteresis is a bitch. This study showed that early career workers of which they only focused on the 22-25 range had a ~20% drop in employment between 2022 and now. If you include the 26-30 range which includes most early-career that's roughly ~30% less jobs, from the Payment Processors perspective. The study doesn't seek to cover other impactors such higher costs on the labor pool, and interference in employment matching, which are also of great concern. 30% after shock normalization is well beyond statistical significance. This is happening, people said it would happen, and no one acted to stop it because they listened to evil people seeking short-term profit; blind to all else. Sad and dark times are ahead. There are things that can be reasonably predicted ahead-of-time, but the moment you give preferential treatment to liars is the moment you lock in losses. Sure the data proving the prediction will come, but not in time to take corrective action; such is the structured cascading failures involving hysteresis.
- adamsvystun 1y agoSo what they actually found is that there is a decline in employment of young people's decline in AI-exposed industries. There are thousands of confounding variables that could have caused this, and they tested only a few. This is by no means a conclusive evidence that AI is taking away entry level software jobs.