Latest news with #AndersHumlum
Yahoo
28-05-2025
- Business
- Yahoo
You'll Spit Take When You Hear How Little Time Workers Are Saving With AI, According to This Huge New Study
The use of AI chatbots has exploded in the workplace. White-collar workers have adopted the tech in huge numbers. Executives are looking for every opportunity to shoehorn AI into every aspect of their businesses. Companies continue to pour tens of billions of dollars into building out enormous data centers to support increasingly power-hungry AI models. But is any of this actually leading to higher efficiency at work and increased pay? According to a recently-released working paper by a pair of economists at the University of Chicago and the University of Copenhagen that was spotted by Fortune, it's not looking great. After analyzing data about 25,000 workers across 7,000 workspaces, users of AI only saved on average three percent of time. And only a meager three to seven percent of those productivity gains translated into bigger paychecks, they found. Put simply, AI isn't even close to coming for everybody's jobs, a frequently cited fear — and it's not exactly making workers more productive, either, despite the industry's many reassurances. "While adoption has been rapid, with firms now heavily invested in unlocking the technological potential, the economic impacts remain small," the two economists wrote in their paper. "Our findings challenge narratives of imminent labor market transformation due to generative AI." As The Economist points out, while many pundits point to growing unemployment and blame AI, existing macroeconomic data suggests there are plenty of other reasons to blame. To the contrary, the magazine found that employment in white-collar work has actually risen in the past year. "Software, writing code, writing marketing tasks, writing job posts for HR professionals — these are the tasks the AI can speed up," coauthor Anders Humlum, at UChicago, told Fortune. "But in a broader occupational survey, where AI can still be helpful, we see much smaller savings." "I might save time drafting an email using a large language model, so I save some time there, but the important question is, what do I use that time savings for?' he added. "Is the marginal task I'm shifting my work toward a productive task?" What workers actually do with the tiny amounts of extra free time, courtesy of AI, isn't exactly comforting, either. More than 80 percent of workers in the study said they used saved time for more work. Less than ten percent said they took the time off. The findings "suggest that workers are not exactly knocking on the boss's door asking for more work," Humlum told Fortune. Signs that the impact of AI on the labor market has been overblown are certainly there. Earlier this year, Klarna CEO Sebastian Siemiatkowski admitted that his all-in approach to replacing human customer service agents with AI was not working. The company revealed last week that it's facing net losses of $99 million for the first quarter of this year, more than double compared to the same period last year. Last week, Duolingo CEO Luis von Ahn walked back his earlier promises to replace all contract workers with AI following an immense wave of customer blowback. Earlier this month, an IBM survey found that only a fraction of AI initiatives are delivering a return on investment after surveying 2,000 CEOs. These latest findings are an intriguing reality check for the notion that AI is coming for all of our jobs. Perhaps the tech is both making us efficient, but also failing to make us redundant. The conclusion highlights growing concerns that generative AI tech may be a dead end after all, as some experts have warned. Perhaps our jobs may be safe — other societal factors, like historic levels of economic uncertainty, notwithstanding. More on AI job automation: AI Is Replacing Women's Jobs Specifically
Time of India
20-05-2025
- Business
- Time of India
AI is not increasing productivity or leading to job losses, finds a study
A new study by the National Bureau of Economic Research in Denmark has found that the use of Artificial Intelligence (AI) in workplaces has had a very limited impact on employee pay and work hours. The report, based on data from 25,000 workers across 7,000 offices, shows that while AI is being adopted quickly, it is not transforming productivity or leading to job losses. Study looked at jobs most exposed to AI The research focused on roles that many believe are most at risk from AI—accountants, customer support specialists, financial advisors, HR professionals, software developers, and teachers. These professions are often seen as likely to be changed or replaced by new AI tools. No big change in pay or hours worked Economists Anders Humlum and Emilie Vestergaard, who authored the paper, said, "AI chatbots have had no significant impact on earnings or recorded hours in any occupation." On average, workers saved three percent of their time due to AI. But only three to seven percent of these productivity gains resulted in higher pay for them. No sign of major disruption The study found no evidence of people losing their jobs or of any large rise in productivity due to AI. The authors wrote, "While adoption has been rapid, with firms now heavily invested in unlocking the technological potential, the economic impacts remain small." They added, "Modest productivity gains (average time savings of 3 per cent), combined with weak wage pass-through, help explain these limited labour market effects. Our findings challenge narratives of imminent labor market transformation due to Generative AI." Some firms still cutting staff for AI Despite these findings, some companies continue to replace workers with AI. Cybersecurity firm CrowdStrike, which was in the news last year for a global IT outage, recently said it would cut five percent of its workforce and use AI instead. Language learning platform Duolingo also announced that it would "gradually stop using contractors to do work that AI can handle." The company said it had made a similar move in 2012 when it shifted its focus to mobile technology. Live Events Company rehires humans after AI fails to meet expectations Swedish fintech company Klarna is preparing to bring back more human workers after depending heavily on artificial intelligence (AI) for customer service tasks. The company had earlier reduced its workforce and automated several functions using AI tools but now says the results were not as expected. Klarna executives admitted that AI customer agents could not match the quality of service delivered by humans. Automation led to performance drop Over the last two years, Klarna worked closely with OpenAI to cut jobs and automate operations. By 2023, it had paused hiring and used AI to handle most customer service functions. This move helped the company save money, including $10 million on marketing. AI systems were used for tasks like translation, content creation, and data analysis. However, Klarna's CEO Sebastian Siemiatkowski later said, 'Cost unfortunately seems to have been a too predominant evaluation factor when organising this, what you end up having is lower quality.' Staff strength saw a major drop According to Klarna's IPO filing in March, the total number of full-time employees dropped from 5,527 in December 2022 to 3,422 by the end of 2024. The company said AI was doing the work of around 700 customer service agents. Even in late 2024, Siemiatkowski had said, 'AI can already do all the jobs that we, as humans do.' But the company's recent shift suggests otherwise. Other firms cutting jobs for AI too Klarna's move is part of a wider trend in the tech and finance sectors. CrowdStrike, a cybersecurity company, recently said it would cut five percent of its staff and shift some roles to AI. Similarly, Duolingo announced plans to reduce the use of contractors for tasks AI can handle. The language-learning app said it would automate more internal processes and limit new hiring to teams that cannot automate further. Microsoft cuts 6,000 jobs amid AI expansion Microsoft has also joined this trend. The company laid off about 6,000 workers, or nearly 3% of its global workforce, as it pushes further into AI. Among those let go was Gabriela de Queiroz, Director of AI for Microsoft for Startups. 'I was impacted by Microsoft's latest round of layoffs. Am I sad? Absolutely,' she wrote on social media. According to Bloomberg, over 40% of the roles cut in Washington state were in software engineering. The company said it was reorganising to simplify management. Despite losing her job, de Queiroz said she stayed a bit longer to finish meetings and say goodbye, writing, 'That felt right to me.' Economic Times WhatsApp channel )
Yahoo
19-05-2025
- Business
- Yahoo
AI is storming workplaces — and barely making a difference, study says
Surely, the billions of dollars invested in AI chatbots will increase productivity and put economic performance into hyperdrive, right? Hold the phone, say researchers at the National Bureau of Economic Research (NBER), a think tank in Cambridge, Massachusetts. 'Despite substantial investments [in chatbots], economic impacts remain minimal,' they write in a new report. Economists Anders Humlum and Emilie Vestergaard estimate in the report, called 'Large Language Models, Small Labor Market Effects,' that productivity gains from AI chatbots amounted to a mere 3% in time savings. 'AI chatbots have had no significant impact on earnings or recorded hours in any occupation, with confidence intervals ruling out effects larger than 1%,' they write. Considering the corporate hype promising revolutionary change in a post-ChatGPT world — both Shopify and Duolingo announced recently that managers would need to justify hiring humans instead of using AI — the NBER report lets a lot of air out of the balloon. The researchers collected the majority of their data in Denmark, a country with high AI adoption and detailed record-keeping. They found that AI adoption had yet to lead to massive layoffs, but neither did it deliver considerable financial advantages to either employers or employees. Instead, most of the hype is based on corporate FOMO and a desire to keep up with rivals. The report says that earlier studies focused mostly on areas where the time-saving advantages of AI chatbots were most obvious, like with customer support specialists, who are being replaced en masse. Humlum and Vestergaard looked beyond the obvious and studied 7,000 workplaces that included fields such as law, journalism, bookkeeping, financial advice, and teaching. 'Software, writing code, writing marketing tasks, writing job posts for HR professionals — these are the tasks the AI can speed up,' Humlum told Fortune, saying that earlier studies weren't wrong, just incomplete. 'In a broader occupational survey, where AI can still be helpful, we see much smaller savings.' Employee time freed up by AI was used for other work tasks — including fixing mistakes created by AI in transcription, or making it difficult for students to use AI to cheat. Earlier this year, 2024 Nobel prize winner Daron Acemoglu predicted that AI adoption will increase the U.S. GDP by only as much as 1.6 percent in the next decade, while productivity would only increase 0.05 percent. 'We're still going to have journalists, we're still going to have financial analysts, we're still going to have HR employees,' he told MIT Technology Review. 'It's going to impact a bunch of office jobs that are about data summary, visual matching, pattern recognition, etc. And those are essentially about 5% of the economy.' Acemoglu went on to suggest that 'hype is making us invest badly in terms of the technology.' 'We're using it too much for automation and not enough for providing expertise and information to workers,' he said. For the latest news, Facebook, Twitter and Instagram.
NDTV
19-05-2025
- Business
- NDTV
Has AI Been Overhyped? Study Shows Minimal Impact On Jobs And Pay
Artificial intelligence (AI) has been the buzzword for companies globally for the last two years. The popularity of AI models has left human workers concerned about their careers as employers attempt to use the technology to cut costs, increase efficiency and maximise revenues. And yet, one of the first studies to analyse AI use in conjunction with employment data has returned some 'mild' results. A working paper released by the National Bureau of Economic Research, Denmark, found that AI's use had a negligible effect on hours and pay. On average, employees saved three per cent of their time, while just three to seven per cent of their productivity gains came back to them in the form of higher pay. "AI chatbots have had no significant impact on earnings or recorded hours in any occupation," economists Anders Humlum and Emilie Vestergaard wrote in the paper. For the study, 25,000 workers across 7,000 workspaces were analysed. The majority of the employees belonged to occupations (accountants, customer support specialists, financial advisors, HR professionals, software developers and teachers) believed to be susceptible to disruption by AI. After analysing the data, the researchers said they found no displacement of human workers, nor did they see "transformed productivity and hefty raises for AI-wielding superworkers". "While adoption has been rapid, with firms now heavily invested in unlocking the technological potential, the economic impacts remain small," the researchers said. "Modest productivity gains (average time savings of 3 per cent), combined with weak wage pass-through, help explain these limited labour market effects. Our findings challenge narratives of imminent labor market transformation due to Generative AI." The findings may shock the companies which are actively trying to reduce their headcount in favour of AI. CrowdStrike, the infamous cybersecurity company responsible for the massive global IT outage last year, announced this month that it was slashing five per cent of its workforce and replacing it with AI. Similarly, language-learning platform Duolingo announced it would "gradually stop using contractors to do work that AI can handle". The company justified its switch in approach, stating that it had taken a similar call in 2012 by betting big on mobile.
CNBC
08-05-2025
- Business
- CNBC
Generative AI like ChatGPT is at risk of creating new gender gap at work
Popular generative artificial intelligence tools such as ChatGPT can be a boon for productivity and efficiency. But in adoption of the technology at work, a significant gender gap threatens the widespread use of it. Technology and business leaders need to wake up to this reality or risk missing out on the potential benefits of AI for business, which include improved customer service, more efficient content creation, enhanced data analysis, and cost savings through automation. New research shows that women are considerably less likely than men to use ChatGPT. Why that is the case was not part of the research, but regardless, it's something senior technology executives including chief information officers and chief technology officers, as well as other C-suite leaders, need to be concerned about. "Recent studies have documented meaningful productivity gains from tools like ChatGPT," said Anders Humlum, assistant professor of economics at the Booth School of Business, University of Chicago. "The fact that women are significantly less likely to use these tools means they may be missing out on these benefits," Humlum said. For businesses, this represents both a lost opportunity to boost overall productivity and a potential driver of widening gaps between workers, Humlum said. In a survey of 18,000 workers from 11 occupations completed in 2024, researchers at the University of Chicago in collaboration with Statistics Denmark found that ChatGPT has been widely adopted in those occupations, with 41 percent of workers using it for job-related tasks. On-the-job adoption rates ranged from 65% for marketing professionals to 12% for financial advisors, and almost everyone in the survey was aware of the technology, according to the report. But when researchers looked at the demographics, they discovered that women were 16 percentage points less likely than men to use ChatGPT for job tasks, even when comparing workers within the same occupation and with similar job responsibilities. Research from professional services firm Deloitte also indicated a gender gap in generative AI adoption. Its analysis showed that women in the U.S. have been lagging in taking up the technology. In 2023, Deloitte said, women's adoption of generative AI was about half that of men. In 2024, the gap remained, although it was narrower. "Generative AI tools such as ChatGPT offer businesses the opportunity to streamline tasks and boost efficiency," said Ritu Jyoti, group vice president and general manager of AI and data market research and advisory services at International Data Corp. "However, concerns arise if there is a disparity in the utilization of these tools, particularly among women. This discrepancy could hinder businesses from fully capitalizing on productivity improvements across their workforce." The existing gender gap in AI adoption has the potential to exacerbate inequalities within the workplace, Jyoti said. "The essence of innovation lies in diverse viewpoints," she said. "If women do not have equal representation in the use of AI tools, businesses run the risk of missing out on novel ideas and solutions that emerge from a more inclusive approach." One possible solution to address the AI gender gap is to provide better training and support. "Establish comprehensive training initiatives to ensure all employees, irrespective of gender, are proficient in utilizing AI tools," Jyoti said. "This can encompass workshops, online courses, and personalized mentoring sessions." Research conducted by Humlum has shown that targeted training on how to integrate tools such as ChatGPT into daily workflows can be highly effective in closing gender gaps in usage, he said. Companies need to offer practical, hands-on training, in which they equip employees with real-world examples of how ChatGPT can support their tasks, Humlum said. "Training increases confidence and lowers the barrier to entry," he said. In addition, organizations that establish clear policies outlining appropriate use of generative AI tend to see broader adoption, especially among women, Humlum said. "Set clear usage guidelines," he said. "Clarify expectations around when and how generative AI should be used. This helps normalize adoption and gives workers permission to explore the tools." It's also a good practice to highlight role models and success stories with AI. "Sharing examples of employees who have benefited from using AI — especially women — can foster peer learning and encourage uptake," Humlum said. And businesses also need to monitor and support equitable adoption of AI-based applications. "Track usage across groups and provide targeted support where adoption lags to ensure the benefits are broadly shared," Humlum said. Companies can regularly evaluate AI adoption rates and productivity metrics to identify gender gaps, Jyoti said. "Implement strategies such as targeted incentives for underrepresented groups, to rectify these disparities," she said. In a broader sense, businesses need to promote an inclusive culture, Jyoti said. "Foster a work environment that encourages the utilization of AI tools by all team members," she said. By highlighting the benefits of AI integration, companies can help to dispel any reservations or stigmas regarding AI, she said. To help ensure diverse representation, organizations also need to involve women in the development of AI applications, Jyoti said. "Diverse teams play a vital role in identifying and rectifying biases in AI systems, enhancing their fairness and effectiveness," she said. By implementing these measures, organizations can create an equitable environment that maximizes the advantages of generative AI for all employees, Jyoti said.
