Demand for AI Skills Continues Climbing

The 2023 Stanford AI Index

Published on Apr 4, 2023

Updated on Jun 16, 2023

Written by Elizabeth Beckett

the 2023 stanford ai index report

The growth of artificial intelligence has led to the creation of new jobs and skills across almost all industries–even those that are not typically tech-affiliated like retail, transportation, and real estate. While the impacts of AI on the labor market are still in the earliest phases, this burst of growth has caused both excitement for the future of work, and fears of job destruction.

As the labor market impact of AI comes into focus, it is likely that AI tools will make many roles more productive in what they do as a complement to the human worker. As productivity increases, GDP is likely to follow. Other roles may be supplanted by AI, though the extent to which this will happen is yet to be seen. As workers think about how to best prepare, and even how to future-proof themselves, it is important to think how technological advancements such as AI will impact the skills workers will need in order to continue to succeed.  

Annually, HAI (Human-Centered Artificial Intelligence), part of Stanford University’s Digital Economy Lab, releases its AI Index. The index is a status report of the role AI is playing in the world, made in collaboration with various partner organizations, including Lightcast. The report tracks the performance of new AI technology as well as its influence in politics, ethical discussion, and the economy.

To determine the effect of this technology on the labor market, the lab uses Lightcast job posting data to observe the growth of relevant skills over the past year. The data revealed impressive growth, despite predating hot-topic tools such as ChatGPT. 

Overall, the Lightcast data revealed that AI job postings saw a large increase in the US, especially in California, Texas, and New York. Every industry (except one) in the US saw an increase in AI related postings, even those that are not associated with AI. Further, every AI-related skill category grew in 2022, with Python as the top requested skill for AI workers.

Lightcast defines an AI job posting as any job posting that requires at least one skill in AI, such as machine learning or natural language processing. Many countries saw a significant increase in AI-related postings, such as Sweden, Switzerland, and the United Kingdom, whereas countries such as Canada, Spain, and Australia saw some decline.

AI Job Postings by Geographic Area

Despite this downward tick, Canada and Spain have the second and third highest concentrations of AI job postings, respectively, though the US has the highest percentage with 2.05% of job postings being AI-related. California, Texas, and New York were the US states that saw the most AI job postings, although the states that saw the highest ratio of AI job postings to all other job postings were Washington DC, Delaware, and Washington state.

AI Job postings by state

The report also indicated that AI job postings were gradually becoming more evenly distributed among US states–in earlier reports, California had a significantly higher proportion of AI job postings. This change underscores the broadening industrial demand for AI jobs and skills; rather than being focused only in tech hubs, AI is spreading and becoming more commonplace. 

Lightcast data revealed an impressive increase in AI related job postings across almost every sector–save for agriculture, forestry, fishing, and hunting. The amount of job postings that were related to AI in the overall job market increased from 1.7% in 2021 to 1.9% in 2022. The sectors that saw the biggest increase in AI postings were Information at 5.3%, Professional, Scientific, and Technical Services at 4.1%, and Finance and Insurance at 3.3%. AI postings also increased in industries not traditionally affiliated with tech, such as Real Estate. As AI optimizes work in all industries (for example, using historical cost data to predict potential new real estate listings), the demand for those skilled in AI is increasing across the board.

AI job postings by sector

Every skill category related to AI saw an increase in demand from 2010 to 2022. Some of the most in-demand AI skill clusters in 2022 were machine learning, seeing a 1% increase in growth since 2010, artificial intelligence at 0.6%, and natural language processing at 0.20%.

Growth in AI postings by skill cluster

In AI-specific job postings, the top skills demanded were Python, which was required in 296,662 job postings, computer science at 260,333 job postings, and SQL at 195,807 postings.

However, this does not mean that so-called old economy jobs are gone - Lightcast data suggests that despite the long standing existence of automated call center technology, there are about 71,000 job openings in customer service right now. 

Overall, the data here show impressive growth in demand for AI throughout the labor market and the broader economy. It will be important to stay atop of the labor market as this new technology becomes more commonplace. Those with existing AI skills are likely to see more opportunity, and employers who have yet to adapt to this shift will need to reevaluate to avoid changes as the market becomes more competitive. 

With AI usage becoming more standard with the introduction of tools such as ChatGPT, the surge in AI related job postings and skills is unsurprising. To learn more about the current status of AI–not just its impact on the labor market, but also specific technological developments and the greater implications of its growth–the 2023 Stanford AI index Report can be downloaded here.