AI Job Market Booms, While Broader Hiring Slows
Are you searching for a new job? Pursuing a career in artificial intelligence could be a smart move. The market for AI-related jobs has seen a significant surge in the last two years, according to a recent analysis by the University of Maryland in partnership with the job-tracking firm LinkUp. This study is just one of many indicating a high demand for individuals skilled in artificial intelligence.
Anil Gupta, a professor of strategy, globalization, and entrepreneurship at the University of Maryland’s Smith School of Business and co-leader of the research, noted a clear “ChatGPT effect.” This refers to the spike in job postings that followed the launch of OpenAI’s chatbot, which has driven a significant increase in demand for AI professionals while also replacing many IT-related job listings.
The AIMaps project, a collaborative effort between the University of Maryland’s Smith School of Business and LinkUp, conducted this analysis. It monitors trends in AI job growth across various sectors in the United States, including but not limited to manufacturing and retail. The data reveals that job postings in AI fields have increased by 68% in the U.S. since the end of 2022. During the same period, overall job postings have declined by 17%.
According to data provided to CNN by ZipRecruiter, AI job postings on the site saw a growth of 124% from 2023 to the end of 2024. Furthermore, in January, LinkedIn identified AI engineer and AI consultant roles as the fastest-growing jobs in the U.S. Last year, PwC found that jobs requiring AI skills were growing more than three times as rapidly as all other jobs.
Conversely, IT job postings, which include positions not directly related to AI, have decreased by 27% since the end of 2022, as stated by Gupta. While the rise of AI has generated new job categories, tech giants have also announced major investments in AI, sometimes resulting in workforce reductions. These layoffs haven’t always been directly related to the displacement of human workers by AI.
For instance, Google implemented layoffs across its Google Assistant and hardware divisions shortly after announcing a multi-billion dollar investment in the AI startup Anthropic. A survey conducted last month by the World Economic Forum indicated that 41% of employers plan to downsize their workforce in favor of AI by 2030.
“We already know GitHub Copilot and other AI tools are able to do 60-70% of the coding,” Gupta said. “Four people can do the job of 10.”
The Global AI Race
The global race to advance AI is only beginning, as demonstrated by the recent introduction of DeepSeek, a Chinese startup that disrupted the market with an AI model allegedly costing a fraction of its American competitors like ChatGPT to develop. Gupta suggests that DeepSeek’s open-source approach – meaning its architecture is freely accessible for others to use and modify – could accelerate the industry’s growth.
““This will lead to an even faster deployment of AI technology in every industry, be it software development, technical services, banking, insurance, manufacturing, or agriculture,”” his team wrote in their analysis.
Over the past couple of years since ChatGPT triggered an AI boom, major American tech companies continue to invest heavily in their AI programs. In January, Microsoft announced plans to spend approximately $80 billion in fiscal year 2025 on AI data centers, and President Donald Trump announced the creation of Stargate, a partnership involving OpenAI, SoftBank, and Oracle, that plans to invest up to $500 billion in AI infrastructure in the coming years.
Consulting firms are seeing especially high demand for AI-related expertise, Gupta explained. Non-AI companies often hire consulting firms like Accenture and Bain to help develop AI tools, hiring roles like machine learning engineers and product managers for generative AI tools. Accounting firm Ernst & Young reported in December that 97% of business leaders whose organizations invested in AI saw positive returns on the investment.
However, some companies may be slow to adopt the technology because of potential privacy and security risks, according to Julia Pollak, chief economist at ZipRecruiter.
Efficiency Concerns and Broader Economic Trends
Companies are looking to “do more with less,” particularly during a broader job market slowdown. The trend of increasing efficiency is due to rising interest rates and limited access to credit, says Lisa Simon, chief economist at Revelio Labs, which tracks workforce data. Some companies are centralizing functions, eliminating unnecessary roles, and reducing layers of management.
Although the demand for AI jobs has risen, Pollak stated that it is too early to fully understand how AI is influencing specific job categories. She speculates that hiring plans might become “leaner” because AI tools have boosted efficiency in fields like content writing.
“We think that the jobs that are in particular adopting AI are seeing larger hiring declines,” Simon said.
Companies are also seeking to “do more with less” beyond applying AI in the workplace. Reports from Revelio Labs reveal that U.S. companies are increasingly employing skilled workers abroad, particularly in positions that support remote work. The report indicates that the realization that the most expensive location is not always necessary to hire technology or software engineers has made offshoring an attractive, cost-saving option in workforce planning.
Data from the Bureau of Labor Statistics indicates that the U.S. economy was expected to add 170,000 jobs in January and the unemployment rate was expected to hold steady at 4.1%.
The tech industry saw rapid expansion during the pandemic, as physical businesses transitioned to online services. Bureau of Labor Statistics data shows that consumer behavior and economic activity have now largely returned to pre-pandemic patterns. From March 2020 to September 2022, jobs in the software publishing sector increased by 30%, but decreased by 1% between September 2022 and December 2024.
Nationally, the post-pandemic growth has been more stable. Job numbers increased by 2% between March 2020 and September 2022 and have increased by 4% since then.
Regarding concerns that AI will result in widespread unemployment, Gupta presented a more optimistic viewpoint, believing that the corporate world will, instead, adapt to the efficiencies provided by the technology.
“There was a time when a six-day work week was the norm, and now (we have a) five-day work week,” Gupta said. “Could it be that in 10-20 years, it’s a four-day work week? I think the prospects of that are very, very high.”
