Job Openings Cool as AI-Fueled Stock Market Booms, Raising Questions โAbout Labor Impact
WASHINGTON D.C. – โค A paradoxical economic โtrend โขis unfolding in the โฃUnited States: job openings are decreasing while the stock market, particularly AI-related stocks,โ experiences critically important growth. This divergence is sparking debate about the role of artificial intelligence in โคreshaping the labor landscape and driving market gains.
Since November 2022, โฃAI stocks haveโค accounted for 75% of S&P 500 returns andโ 80% of earnings growth, โขaccording โto JPMorgan. Thirty AI-related companies now comprise approximately 44%โ of the S&Pโ 500’s total โคvalue, generating roughly โ$5 โขtrillion โinโค wealth gains for US households over the past year. The rallyโฃ is โขlargely driven by major techโ companies including nvidia, Microsoft, Apple,โฃ Amazon, โฃAlphabet, and Meta. Notably, some ofโ these companies, like โฃMeta, have simultaneously implemented layoffs while witnessing stock price increases. This concentration raises bubble concerns, withโ the “Magnificent Seven” stocksโ representing over โฃone-thirdโ of the S&P 500 index – a level exceeding even the dotcom โฃera.
However, the economic upswing isn’t universally felt. Increased immigration restrictions have contributed to risingโข business costs and slowed labor force growth,furtherโฃ limiting job creation. A โstudyโค by the National Foundation forโ American Policy estimates these โขpolicies could reduce the USโฃ workforce by 15 millionโข people over the next decade and cut annual economic growth by nearly one-third.
Early warningโฃ signs of AI’s impact on the โjob โmarket are emerging, particularly for younger workers. Stanford University research indicates that โemployment โขamong those aged 22 to 25 in occupationsโข highly exposed to generative AI โhas declined by roughly 13% since the technology’s widespread adoption. Conversely, โฃjobs in less exposed fields and moreโข experienced workers in the same occupations have remained stable or grown.
JPMorgan researchโ shows theโค unemployment rate among college graduates reached 5.8% in March 2024, the highest in overโข four years, and โขis exceeding โคthe โขoverall unemployment rate. While other factors may be at play, โMichael Feroli, chief โขUS โeconomist at JPMorgan, โคsuggests AI effects couldโฃ be contributing to this โคtrend.
