It was a surprisingly strong month for America’s labor market — and for the workers worried about an AI-driven white-collar wipeout, new jobs were a bright spot.
Professional and business services, a broad sector that includes white-collar industries like legal services, consulting, and scientific research services, added 70,000 payrolls in October. That’s well above the sector’s average monthly gain of 15,000 jobs throughout the past year, and welcome news for the white-collar workers who saw the sector hit a low just a year ago.
“The bounce back in professional and business services is a good reminder that AI isn’t wiping out white-collar jobs,” Heather Long, chief economist at Navy Federal Credit Union, said in written commentary. “There was even a big boost in administrative assistant hiring, another encouraging sign.”
While AI may not be wiping out white-collar work as was widely feared, it is changing what people in tech-heavy roles actually do on the job and what employers are looking for in new hires. ZipRecruiter economist Nicole Bachaud told Business Insider she thinks AI is changing role requirements and the skills in demand, leading to volatility in tech-related industries. Employers may be looking for people with AI knowledge or soft skills like critical thinking, rather than traditional technical skills.
“As these skills change so rapidly, I think we’re going to see more turnover and, as a result, more volatility in professional and business services, in financial activities, and information,” she said. “The next couple of months are really going to be telling of where that lands, but I do think we’re going to see some bouncing back and forth.”
Some of the gain in professional and business services comes from temporary staffers; help services added 18,600 jobs in October after a drop of 5,600 in September. Bachaud said that this indicates employers are starting to make business commitments without hiring new full-time workers.
Still, Cory Stahle, senior economist at Indeed, told Business Insider he wonders how sustainable the growth in professional and business services really is — and said it’s still below its long-term trend.
“You can see that there are far fewer jobs than we would expect if it just continued what it was doing prior to the pandemic, so I think some of this could be trying to catch back up a little bit with that,” Stahle said. “It’s too early though from a single report, especially on a noisy industry, to draw any conclusions about AI or knowledge workers.”
Meanwhile, robust data center building wasn’t enough to prop up the construction industry. The sector still shed jobs, with gains in electricians and other specialty contractors who work on data centers and other commercial and industrial projects not enough to offset losses elsewhere.
Beyond professional and business services, other sectors experienced net job growth; healthcare, a stalwart of the job market for years, added about 42,000 jobs and manufacturing added 19,000 jobs. Some holiday hiring was also likely reflected in the report; transportation and warehousing experienced a solid gain of about 25,000, with couriers and messengers accounting for 70% of that.
“There’s a lot of expectations that maybe this holiday shopping season is a little bit dampened given high gas, high inflation, high prices, high rates,” Bachaud said. “But seeing this uptick in transportation and warehousing, especially in courier services, that might be a signal that the holiday shopping season might be ramping up more so than was expected.”
Overall, the new jobs report shows a brighter job market, given upward revisions to the previous two months’ job estimates and better-than-expected growth in October alongside a rise in labor force participation.
“People are ready to make moves in this market, and we’re starting to see some of that pent-up demand starting to unlock now,” Bachaud said.
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