Source: McKinsey Global Institute
Translated: Hans Kexel

As a management consultant with years of experience in the industry, I have made it my mission to track and analyze the latest trends and developments in the world of work. The rapid development and implementation of technologies, especially artificial intelligence, is having a profound impact on the way we work and how companies function.

In this context, I came across a fascinating report by the McKinsey Global Institute which examines the impact of generative AI on the future of work in America. This report offers valuable insights into the changing landscape of the world of work and the role AI is playing in it.

I have decided to publish this report on my blog to share these important insights with you. My aim is to give you a deeper understanding of how these technologies are changing the world of work and the impact this could have on companies and employees. I hope this information will help you make informed decisions for your own career or business.

The world of work in the US is undergoing a rapid evolution driven by several factors. The development of generative artificial intelligence (AI) and its advanced language capabilities are expanding the possibilities of automation to a much wider range of professions.

Since the outbreak of the global pandemic, working models have changed significantly. Many employees have opted for remote or hybrid models and employers have accelerated the adoption of automation technologies. As a result, employees have changed jobs at a remarkable pace, with some even moving into completely different career fields. From 2019 to 2022, around 8.6 million career changes took place and a further 12 million are expected to follow by 2030.

Three main categories of factors are driving growth in certain occupations and decline in others: automation, including generative AI; an injection of federal investment in infrastructure and the transition to net-zero emissions; and long-term structural trends such as aging, continued investment in technology, and the growth of e-commerce and remote work.

The pandemic has accelerated trends that could last until the end of the decade. Occupations that have taken a hit during the recession are likely to continue to shrink. These include customer-facing roles, which have been affected by the shift to e-commerce, and office support roles, which could be eliminated either through automation or fewer people in physical offices. Declines in food service, customer service and sales, office support and production work could account for nearly ten million (more than 84 percent) of the 12 million job changes expected by 2030.

In contrast, occupations in business and legal, management, healthcare, transportation and STEM have shown resilience during the pandemic and are positioned for continued growth. These categories are expected to see fewer than one million occupational changes by 2030.

Employees have shown a willingness to change career paths, while a tight labor market has encouraged companies to hire from broader applicant pools.

The changes estimated in our earlier research are happening even faster and on an even larger scale than expected. There is a growing urgency to solve occupational and geographic mismatches and connect workers with the training they need to get jobs with better prospects. The future of work is already here and it's moving fast.

More than half of the approximately 8.6 million recent career changes in the U.S. involved workers leaving roles in food service, customer service, office support and manufacturing. Managerial and professional roles and transportation services collectively added nearly four million jobs from 2019 to 2022. The pandemic has accelerated these changes and we expect these trends to continue through the end of the decade.

Total employment in low- and medium-paying occupations has declined from pre-crisis levels, while occupations paying more than $57,000 annually have added about 3.5 million jobs. However, it remains unclear how many of the higher-paying roles have been filled by people who have moved up and how many have been filled by new workers. At the same time, the number of lower-paid vacancies has not decreased. The demand for lower-paid services remains, but fewer workers are taking on these roles.

Automation, from industrial robots to automated document processing systems, remains the biggest factor in changing the demand for different occupations. Generative AI is accelerating automation and expanding it to an entirely new set of occupations. This technology is advancing rapidly, but other forces are also influencing labor demand. Overall, we expect significant changes in the occupational mix in the US by the end of the decade.

The impact of automation and generative AI is enormous. Generative AI can be used to write code, design products, create marketing content and strategies, optimize operations, analyze legal documents, provide customer service via chatbots, and even accelerate scientific discovery. All of this means that automation is on the verge of impacting a broader range of work activities that require expertise, human interaction and creativity.

Other forces influencing future labor demand are federal investment and other structural trends. Recent federal legislation is driving momentum and investment in other areas that will impact jobs. Achieving the goal of net-zero emissions is one of those priorities. Some 3.5 million jobs could be displaced through direct and indirect impacts on the economy. But at a macro level, these losses should be more than offset by the addition of 4.2 million jobs, mainly driven by capital spending on renewable energy.

The largest future job gains are expected in healthcare, an industry that already has an imbalance, with 1.9 million job openings in April 2023. We estimate that there could be demand for 3.5 million more jobs for healthcare assistants, health technicians and wellness workers, plus an additional two million healthcare professionals.

The largest future job losses are likely to occur in office support, customer service and food service. We estimate that demand for clerical workers could fall by 1.6 million jobs, in addition to losses of 830,000 in retail sales, 710,000 in administrative assistants and 630,000 in cashiers. These jobs involve a high proportion of repetitive tasks, data entry and basic data processing, all of which are activities that automated systems can handle efficiently.

Overall, we expect more growth in demand for jobs that require higher levels of education and skills, and declines in roles that do not generally require a university degree.

People in the two lowest wage quintiles (those earning less than $30,800 per year and those earning $30,800 to $38,200 per year) are up to 10 and 14 times more likely, respectively, to change occupations by the end of this decade than the highest earners. Jobs in the two lowest wage quintiles are now disproportionately held by people with less education, women and people with an immigrant background.

The U.S. labor market has shown remarkable resilience in the face of recent challenges and rapid change. This type of adaptability is exactly what it will take to navigate the next chapter, supporting individuals while organizations meet their talent needs so they can continue to drive growth.