The Impact of AI on Sustainable Development of The Labor Market

¹ Ningbo HD School, Wenzhou, China
² Zhao Huaai Preparatory Academy, Chengdu, China
³ Xinhangdao, Shenzhen, China
⁴ The Wharton School of the University of Pennsylvania, Shanghai, China

^* Corresponding author: Rikayang0707@gmail.com

Abstract

With the emergence of generative AI technologies like ChatGPT, the conversation has shifted increasingly toward the possibility that machines will take over human jobs. The rise of artificial intelligence (AI) poses a double challenge to job security and the labor market organization while also bringing about remarkable efficiencies and introducing fresh job sectors. The complex landscape requires intentional government intervention based on fundamental economic principles. Information asymmetry is emphasized in discussing AI’s incorporation into the labor market, utilizing Joseph Stiglitz’s information theory. Discrepancies in access to information about emerging technologies and the required skills for the AI-driven economy could exacerbate market inefficiencies and result in job loss. Stiglitz’s remarks underscore the crucial need for governments to actively address these information gaps to enhance market efficiency and promote worker well-being. Potential actions could involve promoting partnerships between educational institutions and businesses to align curriculum with evolving labor market demands and mandating that companies reveal the incorporation of AI into their practices to enhance the accuracy of workforce development plans. This paper analyses the role of government in harmonizing AI’s impact on the labor market, AI’s influence on labor market dynamics, and navigating job displacement in the AI era. In addition, the relevant recommendations are proposed.