Tech Has Never Caused a Job Apocalypse. Don’t Bet on It Now.

Neither theory, history nor the latest data suggests a recession driven by AI job dislocation is likely  

By Greg Ip. Excerpts:

"Technological advancements always cost some people their jobs—those whose skills can be easily substituted by tech. But their loss is more than offset through three other channels. The new technology enhances the skills of some survivors, who become more productive and better paid; it helps create new businesses and new jobs; and it makes some stuff cheaper, increasing consumers’ incomes, adjusted for inflation, which can be spent on other stuff, generating yet more jobs."

"The ranks of software developers, widely assumed to be acutely vulnerable to AI, are up 5% in January from a year earlier, a pace largely consistent with the past 23 years."

"The number of computer programmers, who assist developers in ensuring code runs properly, was down slightly in the last year, in line with a secular decline in place for decades. Neither trend shifted much after ChatGPT’s arrival in late 2022."

"In 2024, the median young computer science graduate earned 63% more than the typical young graduate, up from 47% in 2009"

"business spending on software leapt 11% in the fourth quarter of last year from a year earlier, the fastest in nearly three years"

"This . . . is in line with previous technological advances that drive prices down and demand up enough to offset direct job displacement"

"examples include textile manufacturing in the 19th century, and the spread of ATMs in the 1980s."

"As the number of bookkeepers shrank with the introduction of spreadsheet software in the early 1980s, the number of accountants and financial analysts newly empowered by Lotus 1-2-3 and Excel rose even more."

"Employment of 22- to 25-year-olds in the most AI-exposed occupations such as software developers and customer-service agents fell 6% in the three years after the introduction of ChatGPT"

"Radiologists were supposed to lose their jobs to offshoring, and then to AI. They didn’t, because patients and providers like having humans around to explain their medical images. Since Google Translate launched in 2006, the number of human translator and interpreter employees in the U.S. has risen 73%."

"The money employers or consumers save as AI eliminates jobs doesn’t disappear; it gets spent on something else."

Related posts:

Data Centers Are a ‘Gold Rush’ for Construction Workers: Surging demand means six-figure pay and more perks (2025) 

There Is Now Clearer Evidence AI Is Wrecking Young Americans’ Job Prospects (but the news is not all bad): Young workers face rising AI competition in fields like software development, but some also benefit from AI as a helper, new research shows (2025)

AI Is Wrecking an Already Fragile Job Market for College Graduates (is the problem structural Unemployment & the case of a skills mismatch?) Companies have long leaned on entry-level workers to do grunt work that doubles as on-the-job training. Now ChatGPT and other bots can do many of those chores (2025) 

No, AI Robots Won’t Take All Our Jobs: Instead, they will boost productivity, lower prices and spur the evolution of the labor market (2025) 

IBM CEO Says AI Has Replaced Hundreds of Workers but Created New Programming, Sales Jobs: The tech company promises higher total employment as it reinvests resources toward roles like software development (2025)

Technological Disruption in the Labor Market (2025)

Why AI Might Not Take All Our Jobs—if We Act Quickly (2025)

Will technology cost artists their job? (2023)

The $900,000 AI Job Is Here (2023) 

Prompt engineers chat with generative-AI chatbots (creative destruction and how the economy just keeps creating new types of occupations & professions) (2023)

What Econ 101 Can Teach Us About Artificial Intelligence: Here's why advancing technology often leads to more jobs for humans, not fewer (2017) 

The % of 25-54 year-olds employed was 80.7% in Feb. after being 80.8% in Jan.; Average hours worked at 34.3

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates many college age people who might not be looking for work).

It was 80.6% in Jan. 2020 and 69.6% in April 2020.  Click here to see the BLS data. Here is what it was for each of the last 4 years

2022) 79.883% 

2023) 80.683%

2024) 80.717%

2025) 80.600% (just an 11 month average due to no data for October instead of 12)

 

There have been only 5 months since April 2001 when the % of 25-54 year-olds employed was as high as 80.9%. 

The unemployment rate was 4.4% in Feb. after being 4.3% in Jan. Click here to go to that data. Here is what it was for each of the last 4 years. 

2022) 3.6%

2023) 3.6%

2024) 4.0%

2025) 4.3%

 

Labor Force participation fell from 62.06% from 62.05%. Here is what it was for each of the last 4 years 

 

2022) 62.2%

2023) 62.6%

2024) 62.6%

2025) 62.4%

 

The % of the adult population employed fell to 59.29% from 59.38% (that is people 16 years old and older).  Here is what it was for each of the last 4 years 

 

2022) 60.0%

2023) 60.3%

2024) 60.1%

2025) 59.7% 

 

Here is the timeline graph of the percentage of 25-54 year olds employed since 2016.

 

 

Now since 1948. 

 

 

Now hours worked. This comes from the St. Louis FED. See Average Weekly Hours of All Employees, Total Private. It was 34.3 in Feb. and 34.3 in Jan. Shaded areas indicate U.S. recessions.   

 

 

 

Related posts: 

Now hours worked. This comes from the St. Louis FED. See Average Weekly Hours of All Employees, Total Private. It was 34.4 in Jan. and 34.3 in Dec. Shaded areas indicate U.S. recessions. 

This one has to do with the difference between two employment surveys. See The economy added 339,000 jobs in May according to the establishment survey but the household survey showed a loss of 310,000 and a rise in the unemployment rate from 2023. 

"The reason for the discrepancy is that there are two surveys. The establishment survey is used for the Labor Department's monthly jobs report. They contact businesses for this survey. The household survey is used to put together the unemployment rate. The Bureau of Labor Statistics contacts households for this one."

See also Comparing employment from the BLS household and payroll surveys from the BLS.

Click here to see a good Twitter thread on the jobs report (including wages) from Harvard economist Jason Furman.

See U.S. payrolls unexpectedly fell by 92,000 in February; unemployment rate rises to 4.4% by Jeff Cox of CNBC.

What items are eligible for purchase with food stamps? It's complicated (and is it a case of the tradeoff between Type I & Type II errors?)

See Is a Cookie a Type of Candy? Supermarkets Have a New Food-Stamp Conundrum: Eighteen states are moving to restrict what SNAP funds can buy, but permissible products vary from state to state by Jesse Newman and Laura Cooper of The WSJ. 

This article shows how hard government policy can be and how hard it can be to write a policy clear enough to achieve the desired objectives. Excerpts:

"Beginning last year, the administration has sought to strip soda and junk food from the program by encouraging states to restrict what food-stamp recipients can buy."

"Inside Baesler’s (Baesler’s Market of TERRE HAUTE, Ind), fresh cinnamon buns from its bakery are still eligible for purchase with food stamps, according to the Indiana Family and Social Services Administration, which oversees that state’s program. So are the mini doughnuts in a nearby Valentine’s Day display. Gum, fruit strips and candy bars aren’t."

"grocery executives said that determining which products are food-stamp eligible and which aren’t has become a complex undertaking."

"retail employees have been sifting through state-issued flow charts, scanning product bar codes and checking ingredient lists across thousands of goods in stores. Then they need to catalog them correctly in computers used at checkout."

"Historically, food-stamp recipients have only been barred from buying goods such as alcohol, tobacco, supplements, hot foods and live animals."

"Retail executives and industry groups said guidance from USDA and many state agencies on how to implement the new restrictions has been insufficient. That has caused confusion"

"inconsistencies across states would allow a SNAP customer in Idaho to buy a chocolate-covered cookie candy bar (because it contains flour), but not a milk-chocolate bar (because it doesn’t). The same customer could buy both products across the border in Utah, and neither if they traveled to Arkansas."

[there are] "lines at checkout counters as clerks tell longtime customers they can no longer use food stamps to buy soda or candy."

"The USDA . . . didn’t issue standard definitions for terms such as “candy” and “soda.”" 

One Executive "worries that an employee will accidentally sell a banned item to a SNAP customer, jeopardizing a given store’s eligibility to participate in the program." 

I used the book The Economics of Public Issues in my micro classes. Chapter 1 is called "Death by Bureaucrat." It discusses how the Food and Drug Administration can make either a Type I error or a Type II error.

Type I error: The FDA approves a drug before enough testing is done and when people take it, there are harmful side effects.

Type II error: The FDA tests a drug longer than necessary to stay on the safe side. But people might suffer because the drug is not yet available. 80,000 people died waiting for Septra to be approved.

The FDA would usually rather make a Type II error because the public can blame the FDA if a Type I error occurs.

Things might be similar with food stamps or SNAP. We could make it easy for recipients to shop, letting them use food stamps for lots of items. But then they might buy some "bad" goods. That would be a Type I error.

Or, we could make it hard for them to buy things, having lots of restrictions. But then some "good" items would be excluded. This would be a Type II error.

Related posts:

 

Self-defense laws and Type I & II Errors (2025) 

 

Fraud in immigration applications and Type I & II Errors (2025) 

 

Employee Disability Pay and Mental-Health Leave and Type I & II Errors (2024) 

 

Thalidomide, The FDA and Type I & II Errors (2024)

 

Immigration & Asylum meet Type I & II Errors (2023) 

Accommodations for disabled people and Type I & II Errors (2023)

Solar Panels, Tradeoffs and Type I & II Errors (2022)

Zombies might return and fighting them is art as well as science (2021)

Fraction of Covid-19 Rental Assistance Reaches Tenants and Landlords (follow up to a post on June 11) (2021)

Remdesivir and Type I & Type II errors (2020) 

The Paycheck Protection Program and and Type I & Type II Errors (2020)

The FDA, Masks and Type I & Type II Errors (2020)

Do FAA drone regulations illustrate the tradeoff between Type I & Type II errors (2018)

Maker Of Thalidomide Apologizes (2012)

How Remaking the Neighborhood Could Boost Poor Kids’ Futures

1990s initiative to replace housing projects with mixed-income developments gave children economic lift as adults, research finds

By Justin Lahart of The WSJ. Excerpts:

"The Harvard University economist [Raj Chetty] and his co-authors have documented how poor kids in some neighborhoods can grow up to earn far more than others who grow up just blocks away. The difference: When poor kids move to thriving neighborhoods, they have more social connections and proximity to kids from higher-income families, and their economic futures improve."

"In the waning days of George H.W. Bush’s presidency, Congress appropriated funding to remake deteriorating public-housing projects."

"It demolished distressed high-rises, and used a combination of public and private funds to replace them with a mix of market-rate and subsidized units arranged in low-rise homes and townhouses."

"The economists then turned to what HOPE VI did for kids."

"At age 30, those who had lived in HOPE VI housing earned 16% more than those who had lived in traditional housing projects. The HOPE VI kids were 17% more likely to attend college. Boys were 20% less likely to be incarcerated as adults."

But [there might be] "differences between the families who moved into HOPE VI housing and the families the research compares them with that the economists couldn’t completely control for"

"One thing the research did to address such concerns was to look at siblings who moved into HOPE VI housing. They found that younger children, who spent more of their childhoods in the new housing, tended to do better as adults than their older brothers and sisters." 

For College Applicants, Pressure to Make Summers Count Has Gotten Even Worse

Teens scramble to specialize their summer pursuits early—to convey a ‘story’ to college admissions officers

By Jasmine Li of The WSJ. Excerpts:

"Overachieving teenagers have long pursued a smorgasbord of résumé-polishing summer activities. But a range of impressive summer pursuits is no longer enough, some college advisers say. Students now feel pressure to specialize—as early as their freshman summer—in interests they want to pursue in college.

The idea, college advisers say, is to assemble a list of summer pursuits that show increasing mastery in a distinct specialty. That “narrative” can help students stand out"

"So many students now have high GPAs and strong test scores that the competition has extended to the summer"

[A Stanford freshman] "advises high-schoolers to choose between science and the humanities early on. By junior year of high school, she says, students should specialize within those fields and plan their extracurriculars around that specialty."

"Parents pay thousands of dollars and enlist college counselors to burnish their high-schoolers’ summer portfolios."

"The key is crafting a clear narrative about a student’s passions through their extracurriculars, essays and résumés." 

"Ben Bousquet, director of college consulting at Sierra Admissions and a former assistant admissions director at Vanderbilt University, said his strategy is to help narrow students’ academic interests down to one or two passions. He then recommends summer programs that authentically align with those interests."  

Related posts on storytelling and authenticity:

Colleges And Universities Try To Be Like Hogwarts. What Would Carl Jung Say? (2025) 

The Myth of Authenticity Or The Story Behind Products (2010) 

It seems that people will pay extra if a product has a good story or myth behind it 

The Guru Who Says He Can Get Your 11-Year-Old Into Harvard (big lesson: Optimize childhood ): Jamie Beaton’s Crimson Education offers a pricey, yearslong boot camp preparing kids to apply to the Ivy League. Parents, and Wall Street, are on board (2024) 

"Independent education consultants" help high school students and their parents navigate the competitive college-admissions process (creative destruction and how the economy just keeps creating new types of occupations & professions) (2024) 

Students: Make a mistake on purpose, its good for you! (2007) 

This may sound surprising, but counselors advocate making a mistake on your college applications like an intentional typo. This makes you seem more "authentic." Too often all students look slick and identical. They got good grades, test scores, were on teams, did volunteer work, etc., all with the idea of getting into college. But is that who you really are if you do it just to impress the college? That is why counselors suggest making mistakes. Then your application makes you seem like a more real person, not too good to be true. Of course, colleges project an image, too with their pictures of the nicest parts of the campus and groups of smiling students in their catalogues to make you want to go their. Seems like everyone is trying to impress everyone else with an image.

Lighthouses Are Not Always Public Goods

This is really interesting. It comes from the Public Goods and Externalities entry at the Concise Encyclopedia of Economics. It is by Tyler Cowen. It should also be mentioned that Nobel Prize winner Ronald Coase wrote an article about this that appeared in the Journal of Law and Economics in 1974. So here is the quote from the Tyler Cowen article:

"Lighthouses are one of the most famous examples that economists give of public goods that cannot be privately provided. Economists have argued that if private lighthouse owners attempted to charge ship-owners for lighthouse services, a free-rider problem would result. Yet lighthouses off the coast of nineteenth-century England were privately owned. Lighthouse owners realized that they could not charge shipowners for their services. So they didn't try to. Instead, they sold their service to the owners and merchants of the nearby port. Port merchants who did not pay the lighthouse owners to turn on the lights had trouble attracting ships to their port. As it turns out, one of the economics instructors' most commonly used examples of a public good that cannot be privately provided is not a good example at all."

Click here for an updated version of Cowen's article.

Hackers Recruit Unhappy Insiders to Bypass Data Security

Flat wages, layoffs and automation are creating an army of disgruntled workers with ready access to enterprise networks

By Angus Loten of The WSJ.

People respond to incentives. And we have all heard the phrase "everyone has their price." This article may be an example of those concepts. There even seems to be a market for this "service" with want ads on the dark web. Excerpts:

"The souring economy has hackers on the hunt for disgruntled workers open to assisting with cyberattacks through authorized access into their employer’s digital systems. 

The workers are typically offered a share of ransomware payoffs or stolen data sales for their services. “The lure of coaxing an employee to betray their allegiance is the holy grail for bad actors,” said Mike McPherson, senior vice president of security operations at cybersecurity firm ReliaQuest."

"hackers are actively combing social media apps for workers who post about layoffs, pay issues and unfair treatment, or those who were recently fired, demoted or passed over for a promotion"

"Roughly 32% of all data-loss incidents at organizations worldwide over the past year involved a malicious insider, up from 20% in 2024"

"malicious-insider attacks tend to be more lucrative"

"As a shortcut to finding willing insiders, some hackers post help-wanted ads across the dark web."

"Another strategy is to scan job seeker qualifications on career-networking sites"

"Another cybercrime strategy is to plant hackers inside an organization to pose as legitimate workers. Last year, an Arizona woman was sentenced to eight years in federal prison for helping North Korean hackers use fake credentials to land remote IT jobs at more than 300 U.S. companies" 

"guarding against insider-assisted attacks requires companies to watch for behavioral warning signs, rather than technical indicators. These can include unusual data access patterns, large downloads before a resignation, or the use of unauthorized tools and personal cloud services" 

Competition, elasticity and weight-loss drugs

See The Weight-Loss Price Wars Are Breaking Big Pharma’s Business Model: Prices for GLP-1s are falling fast and forcing companies to adapt by David Wainer of The WSJ.

"Two years ago, a GLP-1 prescription could cost an uninsured patient more than $1,000 a month. Today, Novo Nordisk’s Wegovy pill starts at just $149 through cash-pay programs."

"Typically, drug prices climb or plateau until generics arrive years later. That trend should be even stickier in a duopoly. Yet the obesity market has turned traditional pharma economics upside down."

"there isn’t a comparable precedent for this level of price erosion in the industry’s history."

"In recent years, demand spread through TikTok, Instagram, and word-of-mouth"

"As insurers and employers moved slowly, patients bypassed the system entirely, turning to cash payments.  This shift—combined with persistent brand-name shortages—opened the door for telehealth firms and compounded “copycats,” introducing cutthroat price competition years earlier than the industry expected."

"Drugmakers were ultimately forced to respond with lower prices. They needed cash prices low enough to fend off compounders and to reach uninsured patients at scale."

"The question both companies are now racing to answer is just how elastic consumer demand is in the obesity market. Lower prices are clearly unlocking growth in demand" [I would not say growth in demand but an increase in quantity demanded-the demand line is not moving]

"this isn’t a price war, so much as a search for the price points that open the floodgates of access."

Firms in the oligopoly and monopolistic competition market structure are price searchers, meaning the demand for their product slopes downward. But the article implies that the demand lines are pretty flat or very elastic (but, of course, slope and elasticity are not the same thing). 

Ceteris and the optimal exercise regimen

See Let’s Stop Getting Distracted From This Crucial Question About Exercise by Emily Oster, professor of economics at Brown University. 

Ceteris paribus is a Latin phrase meaning "everything else stays the same" or "holding all other factors constant." Oster does a good job of showing that some of the conclusions of exercise research might not be right because of other factors that were not taken into account  

Excerpts:

"Is walking better than tennis? Is running better than swimming? Is it really important to do 80 percent of your workout at 60-70 percent of your max heart rate (known as Zone 2)? These questions serve an engaged population and promise that with a bit more knowledge, you can maximize your health. The trouble is, they are basically impossible to answer well, and most of the answers we get are misleading and wrong."

"The best way to discover the optimal exercise regimen would be with large randomized trials."

"you’d need enormous sample sizes to detect the — most likely small — differences in a statistically meaningful way. Big trials are expensive. And not everyone wants to stick to a randomly assigned exercise program."

"most of the evidence on the so-called best exercise comes from what are known as observational studies."

[they] "ask people about the exercise they already do and compare their health outcomes to those of people who do more or less exercise, or who do different types of exercise."

"such studies almost always confuse correlation and causation."

[one study] "found that swimming didn’t lower mortality, but running did. Does that mean swimming isn’t effective? No. When you look more closely at the data in the appendix of the study, it’s clear what is going on — swimmers were much less likely than runners to engage in other positive health behaviors."

"only about 5 percent of frequent runners in the study smoked, but among frequent swimmers it’s 11 percent — just shy of the U.S. average. Swimmers were also more likely to have high blood pressure at base line, weigh more and have a family history of cancer. One explanation is that doctors may recommend swimming as a low-impact activity for people who already have higher health risks."

"A 2019 study argued that the benefits of walking leveled off at 7,500 steps a day, suggesting that this was a threshold number. But when you look at the paper, it’s clear that the people who walk more are also more likely to do other healthy behaviors (like abstaining from smoking and eating well). A 2025 paper used wearable devices to suggest that one minute of vigorous activity is equivalent to an hour of light activity. But it doesn’t sufficiently take into account that the mere ability to engage in vigorous activity is most likely already a sign of better health" 

Related posts:

A case of ceteris paribus: does moderate drinking harm your health? (2025) 

Great Moments In Causation Vs. Correlation: Eat more chocolate, win more Nobels? (2012)

Banning Cell Phones While Driving And A Lesson In Ceteris Paribus (2010) 

Tough Professors Are Better For Students In The Long Run (2011)

Will Studying Economics Make You Rich? A Regression Discontinuity Analysis of the Returns to College Major (2023)

Studying Economics Increases Wages a Lot (2020)

U.S. Oil Output Is Strong Despite Very Low Prices. Or could prices be low because of strong output?

See By Resilient U.S. Oil Production Is a Boon to Trump. How Long Will It Last? The oil patch has weathered the lowest crude prices in years and kept pumping by Benoît Morenne of The WSJ. 

Much of this article describes the improvement in oil technology. When technology improves, supply shifts to the right. Then price falls and quantity bought and sold in the market increase. Excerpts:

"Remote monitoring and other feats of technology that have become mainstream are among the clues that help explain why U.S. oil production has—thus far—defied predictions that it would decline in conjunction with the lowest crude prices since the pandemic."

"the country’s wells last year gushed a record 13.6 million barrels of crude on average each day—100,000 barrels more than the Energy Information Administration, the federal forecaster, had anticipated before President Trump’s inauguration."

"Executives credit the outperformance in part to companies’ engineering prowess and the changing makeup of the industry. Oil giants now have a bigger share of crude production in their hands and are largely impervious to price swings, ensuring a steady output. Among other field enhancements, these companies now routinely drill wells that extend over 4 miles and allow them to collect more crude at a lower cost."

"A gallon of regular unleaded gasoline cost $2.92 on average in the U.S. on Tuesday, according to AAA, down 24 cents from a year ago."

"the Permian, a humongous oil field that spans West Texas and New Mexico . . . logged a record 6.72 million barrels a day in the most recent quarter."

"the unruly, debt-fueled frackers that would retreat when prices fell have died off. They have given way to giants armed with sturdy balance sheets that can better weather price shocks."

"these companies have been deploying drilling and pumping innovations across their respective empires. For instance, Chevron in 2019 ran 21 rigs and five frack crews in the Permian. This year it anticipates it will need only six rigs and two frack crews to produce about 67% more oil-and-gas in the region than seven years ago."

"Each rig on average drills 1,500 feet a day, which is more than twice as much as in 2019."

"horizontal wells that extend out 2 miles, make a 180-degree turn and extend for another 2 miles in a U shape."