AI Isn’t Wiping Out White Collar Work … Yet

The death of white-collar work might be greatly exaggerated. The naysayers and doom-and-gloom prognosticators have warned that artificial intelligence (AI) will wipe out cubicle jobs as Skynet replaces everyone except the plumbers. The US labor market, however, might not have gotten the memo. It could instead be a case of Jevons Paradox.

Hot Around the White Collar

The Bureau of Labor Statistics (BLS) recently published its monthly Job Openings and Labor Turnover Survey (JOLTS) for April. This widely watched report assesses vacancies, hires, layoffs, and quits. It has been on a steady downward trajectory since reaching a post-pandemic peak in March 2022.

April’s figures showed that job openings surged by 731,000 to a higher-than-expected 7.618 million, the highest level since November 2024. The one industry registering a spike? Professional and business services, with 668,000 new vacancies.

Put simply, the demand for white-collar work strengthened at a time when everyone is fearing the jobpocalypse. Additionally, this was not a one-off, as other measurements suggest AI could be supporting job growth rather than quashing it.

The May nonfarm payrolls report from the BLS, for example, revealed 6,000 new jobs in professional and business services. ADP reported an 11,000 gain, as well as a 7,000 jump for financial activities. “The hiring recession is over. American firms are hiring again,” said Heather Long, chief economist at Navy Federal Credit Union, according to CNBC.

In other words, if AI plans to eradicate employment, enslave the public, and make the world dependent on a universal basic income, the latest jobs report is not showing any sign of it.

Jevons, Baby

For centuries, critics have expected the worst from technological developments rather than anticipating the best. The light bulb, the automobile, and the computer – labor markets were all expected to experience a blood bath. Instead, the world became richer than ever before.

This can be best understood by the economic theory called the Jevons Paradox, named after the 19th century’s William Stanley Jevons. He contended that as technology makes resources cheaper, there will be greater demand for impacted services and more jobs in those sectors. This has been seen in a wide array of areas, including radiology.

The costs of performing MRIs, CT scans, and PET scans have plummeted by approximately 70%, leading to more of these tests being completed. As more scans take place, employment and salaries for radiologists have ballooned.

AI will inevitably lead to the same creative destruction: Some jobs will be eviscerated, and new industries and positions will be born. It is not an existential threat to the economy or civilization but a productive tool and form of capital. Artificial intelligence will merely amplify human capital, and this will likely bolster white-collar jobs in the years to come.

Headwinds or Tailwinds?

The US labor market is much stronger than it was a year ago. Despite renewed inflationary pressures, a 14-week-old war in Iran, and the prospect of higher interest rates, employment conditions continue to move on from the volatility observed earlier this year. Perhaps it is a case of tailwinds exceeding headwinds: solid earnings growth, fiscal stimulus from the One Big Beautiful Bill, and seasonal demand (the World Cup, for example).

Can the hiring momentum continue in the second half of 2026? One thing is for sure: The unemployment rate will remain low as the breakeven rate – the number of new jobs needed to keep the jobless rate steady – is close to zero.