Gig Work Is Shrinking & AI Can Automate 57% of Your Job On Average

Additional Resources

• ADP NER Pulse
• McKinsey AI Agents and Robots Report
• Conference Board Employment Trends Index Press Release

Transcript

Pete Newsome: 0:00

Happy Thanksgiving, everyone. Today’s headlines include a new McKinsey report on AI and robotics and the conference board’s latest employment trends data. But first, the job market continues to slow down and the gig economy is shifting in an interesting way. This is from the ADP NER Pulse report that was released this morning, where for the four weeks ending November 8th, it shows private employers shed an average of 13,500 jobs per week. Now, this is traditionally when holiday hiring picks up, but ADP notes that consumer uncertainty is likely causing employers to delay or even reduce seasonal hiring. I agree with that, on top of an ever-moving target from the federal government. Seems like the winds are shifting directions every day, and employers just don’t know what to do about it right now. Now, although these numbers are preliminary, it directionally signals a softer labor environment heading into the end of the year. That’s nothing that we didn’t know.

0:57

I keep waiting to see a report that shows some positive trends, but it’s just not there yet. Interestingly, from this report, and perhaps even the bigger story is what’s happening inside self-employment and gig work right now. When the federal government finally released its delayed September jobs report, it showed that the economy added 119,000 jobs. Now that beats uh beat expectations, but for self-employed workers, the news went in the opposite direction. The gig economy lost 114,000 jobs in September, and U.S. gig employment is down 1.2% year over year. Now, ADP’s research suggests that this decline is temporary and is likely to reverse as the labor market undergoes demographic transformations. And I definitely agree. Independent contractors have increased for years now, from 300,000 in 2019 to 450,000 in 2024, and that’s a 50% jump. So the the six-year trend is definitely up, but this year it’s it’s gone in the uh the wrong direction, which did surprise me to see. Self-employment currently sits at 5.7% according to the latest BLS estimates.

2:06

Now, older workers are disproportionately represented among people who are self-employed, and that’s a trend that goes back decades, and largely because contractors tend to work higher paid, expertise-driven roles. So it it’s really no shock that it skews older. 7.2% of contractors are age 70 plus, and that’s compared to 3.8% of the total workforce. And with 10,000 people turning 65 every day, how’s that? That’s a big number. It just makes sense that older, highly skilled workers are increasingly turning to independent contract work. I think some of them do it for the flexible schedule, but unfortunately, I mean we see 70 plus still working, so many of them. I think it’s because they need the extra income. So the gig economy just isn’t driven by young workers. That’s not the case at all right now. And the data makes that very clear. It’s really becoming a second career platform for people who are more experienced. So that’ll be interesting to track over time. ADP deems it the silver gig economy. I think that’s right, but it’s also a bit of a surprise to see just again how many people who are uh should be retired, should be living a great life somewhere, are still at it, still having to work. And hopefully it’s more so because they want to, not because they have to.

3:29

And the next headline: a new report from McKenzie says AI won’t replace workers, but instead it will reshape how every job works. Every report I read goes one way or the other, it seems lately. One says there’s going to be huge job displacement, and the next says, uh, nothing really to worry about, it’s just going to complement what we do. I’m in between, but I think there’s going to be a whole lot more displacement than we’re acknowledging right now. But this report frames the future of work as a three-way partnership between humans, AI agents that handle cognitive tasks, and then robots that will handle physical tasks. And as it relates to the job market, there’s two big takeaways from this report. One is that 57% of work right now in the US could be automated with today’s technology. That is massive. And if you don’t think companies who know that can be done are going to take advantage of it, you’re fooling yourself. If the work can be replaced through automation, through AI, companies will find a way to do it. It’s just the nature of how things work. Whether they should or not is a different discussion.

4:33

I’m worried about what’s actually going to happen in the job market. But the report says although the jobs won’t disappear because while AI excels at execution, it’s not effective when it comes to judgment, empathy, context, or oversight, which we still need humans to do. That’s what humans do best. And to that I say, at least for now, AI is improving constantly, and we are still in its infancy. The second big job-related takeaway, and this is relevant to anyone in the job market, but especially if you’re early in your career, is that demand for AI fluency in job postings has grown by seven times over the past two years. It’s the fastest growing skill that’s listed. It’s only going to increase from here. So embrace it. Get ahead of the curve with AI. Find out how you can leverage it for the job that you’re in, whatever it is, but also, and perhaps more importantly, for your career as a whole. How can it make you better at what you do? How can you use it to increase your knowledge?

5:32

How can you gain efficiency by using AI? There is so much that you can learn for free. You don’t have to go pay for this. You don’t even have to go searching for it. It is all out there through so many tools and resources. And if you don’t know where to find any, let me know. I’ll give you some ideas and thoughts on that for sure. But that is such an interesting thing for me to see and no surprise at all. So even if it’s not going to replace your job, absolutely you should be using AI to make you better at whatever it is you do. For today’s final headline, here’s some seemingly good job market news that’s really anything but when you dig into it. The conference board released their employment trends index this morning. It went up, and that sounds good, but it rose to 106.84, up from 106.68 month over month. So that is a nominal move to say the least. And what’s more important is that this index remains near its lowest reading since COVID.

6:24

Now, five of their eight components improved, including job openings and industrial production, but two declined temporary help and initial unemployment claims. So when unemployment claims go up, you can’t convince me that the job market is good no matter what. But what always jumps out at me from this report is one of these eight components stayed flat, and that is that companies are unable to fill open roles. I just don’t get it. I it it makes no sense to me, and this has been this way for months. And I’ll quote directly from their report it says the share of small firms that report job openings are not able to be filled right now was flat in September at 32%. So one out of three companies, and specifically small businesses to be fair, say that they can’t fill their open jobs. And what I constantly wonder when I see this is what is wrong with you people? Who are you? What are you doing? How are you going about recruiting and hiring? I want to hear from you.

7:23

So if you know of companies that can’t that claim they can’t fill jobs, can’t find good candidates, can’t get people to apply for their roles, whatever it is, please let me know who they are. I’d love to know what they’re doing. They are very clearly doing something wrong, and it’s probably an easy fix, and there’s a huge disconnect between the number of candidates who are looking and this one out of three, 32% of companies saying they can’t find people for their openings right now. Something’s really broken. I’d love to try to help fix it if I could for anyone who can’t hire. So those are your headlines for today. Thank you for listening. But before we wrap for Thanksgiving, here’s a fun fact: Netflix employs professional viewers. Their job is to watch content before it launches and help predict what audience will love next

8:12

How about that? I’m an amateur, I’m not a professional Netflix viewer, but man, given how much I watch it, I would love if I’ll do it for free. If you want to know, I’ll I’ll I’ll do that job for you. I love that idea. So if you’re a professional viewer and you’re getting paid to watch Netflix, man, you have done something right. Good for you. So I guess that’s just proof that some jobs really are as fun as they sound. If you’re in one, congratulations. So thank you for listening. This is it for the this week. I will be back next week. But in the meantime, please like and subscribe. Share with anyone who you think might be interested. And I would love the feedback on the open jobs. If you know any companies who can’t hire, tell me why, point me to them. I’d love to help. Talk to you soon.