US Labor Market 2035: Fewer Workers, Higher Productivity
AI transforms jobs rather than eliminates them amid workforce shortages
1Slow workforce growth
The US workforce will grow only 3.5% by 2035, a third slower than the previous decade's 10.9% growth. This slowdown stems from anti-immigration policies, low birth rates, and aging. The Economist warns these factors will exacerbate labor shortages across industries, even as AI adoption accelerates. Healthcare will account for 37% of all job growth.
2Aging workforce dynamics
Workers over 65 will grow from 7% to 8.5% of the workforce by 2035 - a 21% increase. AARP studies show nearly 10% of seniors are 'unretiring,' extending careers. Yet age discrimination persists, with a quarter of workers over 50 feeling 'left behind.' HR must prioritize generational diversity programs to leverage this talent pool effectively.
3Healthcare dominates job growth
Home health aides will reach 5.5 million workers (18% growth), while registered nurses hit 3.7 million with highest wage gains. Nurse practitioner roles will surge 41% with average wages jumping from $132,000 to $181,000. Healthcare will expand from 13.3% to 14% of total US employment, reflecting demographic needs and care demands.
4AI's uneven job impact
While 13% of jobs (mostly administrative) face full automation, 61% require human touch or empathy. BLS data shows cashiers, clerks, and secretaries declining fastest. Surprisingly, management jobs will grow as 'Superworkers' need 'Supermanagers.' High-touch roles in trades, counseling, and psychology remain secure despite automation pressures.
5The Superworker premium
AI-enhanced roles see wages growing at twice inflation rates. Software engineers evolve into product leaders, HR partners become strategic advisors. Routine tasks vanish, but core roles transform - a cashier becomes a customer experience specialist. These 'Superworker' positions focus on thinking and feeling rather than repetitive tasks.
6Sector-specific challenges
Healthcare, manufacturing, and logistics will face acute hiring pressures. While retail sales jobs shrink 3-5%, high-value sales grows. Teaching remains stable due to reskilling needs. Energy, aerospace, and bio-engineering emerge as growth sectors. Companies must invest in training to bridge skills gaps amid labor shortages.
7Productivity imperative
With workforce growing just 3.5% but GDP projected to rise 22%, annual productivity must increase nearly 2%. This requires accelerated AI adoption across operations. CHROs must lead workforce transformation, balancing automation with human-centric roles. The 'Dynamic Organization' becomes crucial for adapting to these competing pressures.
8Strategic implications
Contrary to doomsday predictions, AI creates more Superworker roles than it eliminates. The real challenge lies in workforce shortages and skills mismatches. Companies must redesign jobs around human strengths while leveraging AI for productivity. Those succeeding will gain competitive advantage in talent retention and operational efficiency through 2035.
Original article: Josh Bersin — US Labor Market 2035: Fewer Workers, Higher Productivity