A venture capitalist says agentic AI is arriving at a moment when core white-collar employment is already fragile.
In a post on X, Lotus Technology Management’s Alap Shah says job growth outside government-driven categories has stalled over the last three years.
“The dashed white line represents core white-collar employment, excluding employment in sectors driven by government spending, specifically Government, Health Care (government spending is half of spending) and Private Education (government loans and loan guarantees drive a significant portion of the market).
We can clearly see a stagnant and declining trend in core ex-government white-collar employment since 2023.”
According to Shah, core white-collar jobs are up only 4% from pre-pandemic levels over six years, compared to population growth of 5% and real GDP growth of 11% over the same period. He added that the Information sector is already down 8% from its peak, with employment below pre-pandemic levels.
Shah warns that the arrival of AI agents could trigger a crisis in the labor market.
“Agentic AI is clearly ramping up its ability to perform white-collar work, and AI CEOs seem very worried about layoffs… The nexus of a weak white-collar labor market and agentic AI adoption suggests a growing risk of a white-collar jobs crisis.”
He also says that even modest layoffs could destabilize the labor market.
“Imagine we get 5% white-collar job losses in 12-24 months, which seems to be significantly less than what Dario [Amodei] or Mustafa [Suleyman] are suggesting. These jobs are unlikely to come back as AI progress continues to accelerate. These displaced workers will be forced to seek blue-collar and gig economy jobs, putting downward pressure on wages for all workers in the economy. Employees who keep their jobs will be keenly aware of the growing risk leading to plummeting consumer confidence and spending.”
In a recent post, Shah and Citrini Research laid out a scenario in which unemployment has soared to 10.2% as AI capabilities improved beyond expectations, ultimately leading to the hollowing out of white-collar America.
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