Indeed's chief economist on why AI is changing jobs without wiping them out

• As the workforce ages and AI changes how work gets done, labor supply is tightening and skill requirements are shifting.
• Most jobs will see gradual, AI-driven transformations rather than wholesale replacement or disruption.
• Organizations that invest in helping workers adapt alongside AI as roles evolve will be better positioned to compete in the future of work.

The global job market is at a pivotal moment. Labor supply is tightening. Skill requirements are shifting. And AI's role in the workplace is expanding — though not uniformly or as fast as some headlines might suggest. In this environment, the advantage will go to organizations that stay closely attuned to how jobs and skills are evolving, and actively support workers as they adapt alongside new tools.

That's the word from Indeed's chief economist, Svenja Gudell, who spoke at a Business Insider-hosted roundtable in Davos, Switzerland, in January. Here's how she and the team at Indeed are thinking about how companies can future-proof their workforce for what's ahead.

A time of redesign, not disruption

According to Gudell, today's labor market looks less like a moment of disruption and more like one of redesign. The good news is jobs aren't disappearing just yet. However, the way work gets done is changing.

Gudell said what leaders really need right now is a way to navigate the changes without getting overwhelmed by all the available data. They need clarity around which signals matter and which are just noise.

The real impact of AI might be a good place to start.

The reality of AI and jobs

Gudell said generative AI (GenAI) is best understood as a continuum of change, not a binary story of jobs lost versus jobs gained. That's because, according to Indeed's data and analysis, few jobs today can be fully replaced by AI. And only about a quarter of jobs could be subject to major transformation by GenAI.

The majority of jobs (54%) could experience moderate or "hybrid" transformation, where AI assists with tasks, but humans still lead the work, according to Indeed. Across nearly 2,900 skills analyzed by Indeed, less than 1% are fully transformable today.

The company also predicts that 46% of skills potentially change, task by task, rather than disappear altogether. The big shift will come as people transition from doing all of their work themselves to directing work done by AI. They will exercise judgment and strategize more than engage in the nitty-gritty details of a given task.

Still, AI adoption remains uneven in Gudell and her company's analysis, growing rapidly in some sectors and more slowly in others. Only 4% of US job postings on Indeed even mention AI. Most employers (45%) have no AI-related postings at all.

"Our data shows that only the largest tech-forward companies are starting to really experiment with this," Gudell said of generative AI.

The takeaway from Gudell is that AI-driven transformation will be gradual, uneven, and as dependent on organizational choices as it is on technical capabilities.

A cooling, not collapsing labor market

Helping to complete the picture, Indeed sees the labor market cooling but not collapsing. In this low-hire, low-fire environment, companies aren't hiring aggressively, but neither are they laying off large numbers of people. In that regard, 2026 should look similar to 2025.

Job postings are currently about 52% above pre-pandemic levels, and unemployment is modestly higher at 4.4%. And if employers aren't making any big moves, neither are workers. Quit rates are back to 2014—2015 levels.

White-collar and remote roles (tech, marketing, office-based) are under the most pressure in Indeed's data. Junior roles are also down 21% compared to before the pandemic, making it harder for younger talent to enter the workforce. Contrary to what some might expect, the declines started before GenAI went mainstream. The driver, according to Indeed: pandemic over-hiring, not ChatGPT.

"It's so important to recognize that there are so many trends colliding right now," Gudell said. "We hear the headlines of layoffs happening, [but] most of those are not AI-driven. That is an adjustment of the workforce, particularly if you're a tech company and you're adjusting to a new demand landscape."

Meanwhile, healthcare, construction, and other sectors with minimal AI involvement are facing shortages, even in a cooling market. It's a preview of what's to come as the workforce continues to age.

Besides aging populations, Indeed sees declining labor participation rates and slowing immigration increasingly reshaping how and where businesses find talent. AI can play an important role here, Gudell said.

Future-proofing the workplace

Gudell said the biggest mistake leaders can make right now is treating AI purely as a cost-cutting tool, since most jobs are too complex for full automation. Instead, she and her colleagues advise redesigning how work gets done based on which tasks can be automated and which require uniquely human traits such as judgment, creativity, and empathy.

"That human element is really important," Gudell said. "That critical thinking, that leadership, the empathy, the communication. As of right now, that's not something AI is particularly good at."

The workplace redesign Gudell and company suggest won't be easy. They see one of the biggest challenges as employers having to reimagine roles with day-to-day work still in progress. To help them accomplish this task of building the plane while flying it, they advised employers to hire for potential, not just credentials, prioritizing adaptability, critical thinking, and the ability to oversee AI.

Gudell and Indeed see a race shaping up between an aging workforce and AI-driven productivity. AI could help fill widening gaps in available labor and skills. And that can benefit workers and employers alike as they both turn to AI to enhance their value in the marketplace.

Get the latest insights from Indeed Hiring Lab to stay ahead in the evolving world of work.

This post was created by Insider Studios with Indeed.

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