Measuring the Economic Effects of AI
A path forward
EIG has just published my new report outlining the most valuable steps that policymakers should take to better measure the economic effects of AI.
Artificial Intelligence appears destined to reshape the labor market and how firms produce goods and services. Workers, firms, and policymakers will need timely information about how the economy is changing, answering questions such as:
How many firms use AI? How many workers do?
How do firms that use AI differ from those that do not?
What industries are expanding and what industries are contracting?
What skills and occupations are in high demand, and which are increasingly less valuable?
What types of workers are switching jobs and which are losing jobs and stuck in unemployment or falling out of the labor force?
What types of new businesses are being created and how fast are they growing?
High-quality data enables displaced workers to find a new career, students to choose the right skills for the new labor market they will face, and firms to choose which investments to make and which operations to expand or shrink.
The good news is that there is already widespread agreement that something needs to be done.1 Not only that, but much of the statistical infrastructure needed to measure AI’s impact on the economy — surveys that can be expanded, administrative data to combine, human capital within the federal statistical system — already exists.
Policymakers simply need to make some targeted investments and scale what is already working.
Table 1 below summarizes my recommendations. For the full discussion of which measures of AI’s impact are currently available; a summary of findings thus far; and a detailed description of what can be done to improve measurement of AI, see the full report here.
See the Trump administration’s AI Action Plan, the AI Workforce PREPARE Act introduced by Senator Jim Banks, and the Great American Artificial Intelligence Act introduced by Representatives Jay Obernolte and Lori Trahan.
According to the BLS the growth is in Home Health And Personal Care Aides. *More* than all the growth, actually; other sectors have shrunk.
The economic effect of AI is to force everyone to incomes of $35.9k. Until such time as HH&PC robots can do as well.
Given the threats to economic data you reported recently, as well as cuts to the federal workforce, how likely is it that the federal government will implement these recommendations?