The other evening, my four-year-old daughter announced she was putting on a show.

Without warning, she burst into a spontaneous routine of singing and dancing, performing several songs she’d clearly been rehearsing. Moments like this spark an immediate reaction for parents. You start thinking about ways to nurture that enthusiasm. Singing lessons, dancing classes, maybe even acting.

Before long, the house begins to fill with the paraphernalia associated with a host of exploratory hobbies. Roller skates, a violin, juggling balls, a tennis racket, the list goes on. Many of these interests won’t last long. But one or two might reveal a real talent. For parents, it also marks a transition. The baby and toddler phase quietly fades, and suddenly your child is developing interests and abilities at a rapid pace.

In many ways, companies are going through a similar transition with artificial intelligence (AI). At first, they explored different ways the technology might be used, before working out exactly how AI can be integrated into their businesses.

That’s reflected in the jobs market. When AI tools burst onto the scene, the dominant narrative was simple. Jobs would disappear. The idea of an AI jobs ‘apocalypse’ quickly became an easy headline. But our chart this week tells a more nuanced story. It’s based on US job postings on the Indeed website. The chart tracks vacancies posted from January 2020, shortly before COVID was declared a public health emergency. We first see the huge impact on the jobs market of both the pandemic and the subsequent economic bounce back.

The chart then shows what happened after the public release of ChatGPT in November 2022, which was when AI really began to grab our attention. After that, job postings for software developers continued to fall sharply as companies reassessed what the technology might mean for their workforce. Businesses needed time to work out what to stop doing, what to start doing and how their operating models might change.

But once that adjustment period passed, something interesting happened. Demand for roles connected to AI surged. Rather than replacing workers wholesale with AI, companies are now hiring for new roles built around the technology. AI isn’t necessarily eliminating jobs. In many cases, it’s reshaping them. This pattern is familiar. Every major technological shift creates a period of uncertainty before productivity gains begin to emerge.

For investors, the lesson is clear.

Stock markets often react to the narrative long before the data catches up. For investors though, reacting to every dramatic headline rarely ends well. A more disciplined approach is to step back and look at what the underlying data is actually telling us.

In the case of AI, the evidence suggests transformation rather than destruction. Much like youngsters trying out different hobbies, companies are experimenting and learning where the technology works best. Over time, it’s likely those experiments will lead to unexpected opportunities.

Key takeaway

Technological revolutions rarely unfold in a straight line. The early headlines often focus on disruption, but the longer-term story is usually one of productivity improvements and opportunity. For multi-asset investors, the key is to remain disciplined, diversified and focused on long-term structural trends rather than reacting to every new headline that emerges.

‍

Find out more about our multi-asset solution

‍

‍

This article is provided for general information purposes only and should not be construed as personal financial advice to invest in any fund or product. These are the investment manager’s views at the time of writing and should not be construed as investment advice. The opinions expressed are correct at time of writing and may be subject to change. Capital is at risk. The value and income from investments can go down as well as up and are not guaranteed. An investor may get back significantly less than they invest. Past performance is not a reliable indicator of current or future performance and should not be the sole factor considered when selecting funds.