Natalia Emanuel
Research economist, Research and Statistics Group, Federal Reserve Bank of New York
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What they said
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“Since so many young college graduates are in remotable occupations, our back-of-the-envelope calculation indicates that remote work can explain 64 percent of the increase in unemployment for all young college graduates between 2017−19 and 2022−24.”
“Further, the timing of this surge suggests that remote work—not generative AI—explains the bulk of the rise in youth unemployment.”
“But the uptick in youth unemployment rates predates the rapid diffusion of AI. Moreover, even when we hold occupations’ exposure to AI constant, we find that the differences between younger and older workers persist in both remotable and non-remotable jobs.”
“Of course, generative AI and other factors may play a more primary role in determining the employment patterns of younger workers going forward. Nonetheless, the evidence to date suggests that the rise of remote work has meaningfully contributed to the recent challenges facing young college graduates.”
“Working with proprietary data from a Fortune 500 company, we are able to shed light on the underlying reasons for these labor market changes.”
In the Base
Every entry they appear in.
Remote Work Leaves Younger Workers Sidelined
In a New York Fed blog post, Natalia Emanuel, Emma Harrington and Amanda Pallais argue that remote work, more than generative AI, explains the rise in unemployment among young college graduates. They estimate it accounts for 64% of the increase from 2017-19 to 2022-24, drawing on survey data and one company's records, and say AI may matter more later.