Fastexy:Is AI a threat to the job market? Not necessarily, and here's why.

When Carlos Cabrera and Fastexyhis family arrived in the U.S. from Venezuela in 2019 hoping to build a better future, life was challenging at first. Despite having a degree in chemical engineering and years of experience working for a global oil company, he couldn’t find a job to match his skills.

Cabrera ended up taking whatever jobs he could to make ends meet – working at a meat factory and Costco, driving a truck and delivering food. 

Then he had two strokes of luck: a nonprofit organization popped up in a job search, and he discovered artificial intelligence.

From there, his life changed. The nonprofit, Upwardly Global, helps immigrants and refugees with internationally recognized certificates, degrees, or work experience restart their careers. They helped Cabrera purchase a laptop and provided him with career training. Then AI helped him hone his resume and cover letters. 

“I use tech to my advantage,” said Cabrera, for whom English is a second language. He now sends out well-written cover letters that better match his skills to the job descriptions by using ChatGPT, an AI chatbot that uses natural language processing to create humanlike conversational dialogue. Within the last couple of months, he even landed a job as a project manager at a global supplier of energy products and solutions.

Is AI changing the job market?

Many headlines center around how AI will take over people's jobs. AI has even become a major sticking point among Hollywood actors and writers afraid their work can essentially be used to train AI that can then put them out of a job.

However, AI also has the potential to level the playing field for nonnative English speakers applying for jobs by helping them better present themselves to English-speaking employers, research by Emma van Inwegen, a Ph.D. student at MIT's Sloan School of Management, has shown. 

Between June 8 and July 14, 2021, she studied 480,948 job seekers who applied for jobs that require English to be spoken but who mostly lived in nations where English is not the native language.

Of those who used AI, 7.8% were more likely to be hired. They also earned wages that were 8.4% higher than those who didn’t use AI, according to her working paper, co-authored by MIT Sloan Ph.D. student Zanele Munyikwa and MIT Sloan professor John J. Horton. Their research also showed those AI users earned $18.62 per hour on average versus $17.17 per hour for those who had received no resume help.

The study also found no evidence employers were less satisfied with workers who used AI to get the job. 

How can AI benefit businesses?

AI can also give small businesses an efficiency and production boost that can help them compete better against companies with deeper pockets. Keeping costs down for small businesses amid high inflation and rising wages has been difficult, but some have found help through AI. 

Anip Patel, founder of CaPatel Investments, an early stage venture capital firm that invests predominantly in companies that promote South Asian values, says AI has helped his company work more efficiently. Creating brochures and presentations that used to take several days of research and writing can now be done in hours with AI, freeing up time for his assistant to do other work. 

Of course, he said a human must check the work AI does for accuracy but even with that, the time it takes to complete the project is still significantly less. 

“It’s good for business owners and making money,” he said. 

Patel isn't the only one who sees that. Constant Contact, a small-business-focused digital marketing and automation platform, said of the 486 small businesses it surveyed in June, 91% of those using AI said the technology has made their business more successful, and they are using it to regain valuable time in their week, cut down on manual mistakes and grow faster. Additionally, 28% said they expect AI and automation to save them at least $5,000 over the next 12 months.

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As AI improves, will AI make us jobless? 

In the short term, AI will displace some people, but experts say AI ultimately will create more, though different, jobs and benefit everyone. 

The World Economic Forum said in October 2020 that while AI would likely eliminate 85 million jobs globally by 2025, it would also generate 97 million new jobs in fields ranging from big data and machine learning to information security and digital marketing.

“AI is good for candidates because it helps match the ideal candidate with the right job, which can really benefit everyone,” said Jeremy Schiff, chief executive at RecruitBot, which uses AI to help companies recruit candidates. “People are happier because they’re in the right job, appreciated and valued more. And they don’t have to do 30 interviews and get no job offers.” 

On the flip side, companies can fill jobs faster. “We are five times more accurate at identifying the right type of person versus the previous approach,” he said. “If hiring managers had to read through 10 resumes then, we only have to read through two now.”  

Also, if in the middle of interviewing candidates, a company realizes it needs different skills for a particular job, AI can pivot quickly and start looking for different candidates instead of having to stop, rewrite and repost the job description and wait for a new batch of applicants. 

“No one is blindly hiring just using AI technology,” Schiff said. "It’s still the interviewer’s job to determine if the person will work out for the company 

Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at[email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday.