MIT simulation shows AI can replace 11.7% of U.S. workers worth $1.2 trillion in salaries — Iceberg Index tool shows jobs are affected in every state across the country

The Massachusetts Institute of Technology (MIT) and Oak Ridge National Laboratory (ORNL) created a labor simulation tool called the Iceberg Index to simulate the entire U.S. workforce and see how they are affected by artificial intelligence and the government’s policies surrounding it. According to a report by CNBC, the study found that as much as 11.7% of the entire U.S. workforce could already be replaced by AI, which is valued to cost $1.2 trillion in salaries and benefits in various industries, not just in the technology sector.

“Basically, we are creating a digital twin for the U.S. labor market,” ORNL director Prasanna Balaprakash told CNBC. The Iceberg Index records each of the individual 151 million workers and marks them with their associated skills, tasks, occupation, and location. It then relates this data to over 32,000 skills and more than 900 jobs spread across 3,000 counties, and then checks which of these can be replaced by current AI technologies. This allowed the researchers to use the Iceberg Index to forecast the impact of AI before it happened in the real world.

The group’s findings reveal that the widespread tech industry layoffs, which hit over 100,000 this year, are just the beginning, as many more positions in human resources, logistics, finance, and administration are at risk of being replaced by automation. The Iceberg Index does not exactly tell us which jobs will be replaced and when that will happen, but it gives a clearer picture of what many experts and industry leaders have been warning about — that AI will leave a lot of white-collar people behind.

Nevertheless, the simulation tool is more than just a canary in the coal mine. Instead, it’s actively being used by policymakers to help plan for the future and reduce the risks on society. MIT and ORNL have partnered with Tennessee, North Carolina, and Utah, using their labor data to help build the index, and now those three states are using it for planning, checking to see how different policies will play out in the field.

“One of the things that you can go down to is county-specific data to essentially say, within a certain census block, here are the skills that is currently happening now and then matching those skills with what are the likelihood of them being automated or augmented, and what could that mean in terms of the shifts in the state’s GDP in the area, but also in employment,” North Carolina state Sen. DeAndrea Salvador said.

The Iceberg Index helps governments check to see how a certain policy would impact the workforce before it even commits time and resources. This way, it can reduce the waste of taxpayer dollars on ineffective policies, ensuring that their workforces and the general population are prepared for an AI-powered future.

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