Minnesota Employers and AI Part II: Labor Market Information Insights

screenshot from July 2025 Workforce Wednesday Teams event

There’s a lot of buzz—and some concern—about AI’s impact on jobs. You might have seen headlines quoting industry leaders who predict AI could eliminate up to 50% of entry-level white-collar jobs within five years, potentially causing widespread unemployment. While it’s always wise to be prepared, it’s important to maintain perspective.

This article is the second in a three-part series, written with the assistance of AI, covering what was discussed during the Workforce Wednesday session in July. AI is a hot topic in general and is clearly of high interest to Minnesota employers: 416 people attended July’s session. This blog series will break down what was covered on the session, but you are also invited to visit the Workforce Wednesday archive to watch a recording of the session, download a PDF of the presentation materials and access related resources.

On the July 2025 Workforce Wednesday session, Cameron Macht, Regional Analysis and Outreach Manager from DEED's Labor Market Information (LMI) Office, provided a data-driven look at AI's impact on jobs and skills in Minnesota. Macht co-authored a September 2024 Minnesota Economic Trends article with LMI regional analyst Luke Greiner that explored Minnesota's exposure to AI.

Despite rapid AI advancements in the past year, Macht noted that the article’s core insights remain highly relevant:

Significant Exposure: More than 1.6 million jobs in Minnesota (approximately 56% of total employment) will be highly exposed to AI. This doesn't mean replacement, but rather significant interaction.

White-Collar Impact: Unlike past technological shifts that primarily affected blue-collar workers, AI is projected to have a greater impact on white-collar jobs, particularly those with higher educational requirements and wages.

Augmentation, Not Replacement: Many jobs will be enhanced by AI, not eliminated. For example, a labor market analyst can use AI for research assistance, much like accountants use spreadsheets and tax software. The key is understanding how AI can benefit a role.

"Workers with AI will beat those without AI": This insightful quote from AI expert Charles Fadel emphasizes the importance of adopting and leveraging AI skills.

Industry and Geographic Variations: Industries like professional and technical services, management, manufacturing, health care, social assistance, finance, insurance, and educational services are most likely to be exposed. Metro areas generally show higher exposure due to concentrations of technical jobs, but exposure varies across counties based on their unique industrial and occupational mixes.

Education's Crucial Role: The education sector is not only highly exposed to AI but also plays a critical role in teaching students how to use and benefit from it. The focus needs to shift from preventing cheating to preparing students for a world where AI fluency is essential.

Exposure, Not Replacement: A Nuanced View

It’s critical to understand that exposure to AI doesn't inherently mean a positive or negative outcome, nor does it imply replacement over augmentation. The individual worker's interaction with AI will largely determine their experience.

Macht and Greiner’s research revealed that over 1.6 million jobs in Minnesota, roughly 56% of total employment, will be highly exposed to AI. While every job will likely see some level of AI impact, high exposure doesn't equate to full replacement. AI isn't yet capable of completely replacing complex tasks like writing an entire article, let alone the full suite of responsibilities for a labor market analyst. Even modest AI use requires significant human knowledge to guide, refine, and ensure accuracy.

Historically, new technologies like calculators, computers, and the internet have indeed transformed work, but often in unexpected ways. They've enhanced existing jobs, disrupted some, and, crucially, created entirely new ones. AI is likely to follow a similar trajectory. Macht and Greiner’s research, like that from the Federal Reserve Bank of San Francisco on the internet's impact, suggests that while AI will profoundly change how we work, it doesn't necessarily mean widespread job disappearance.

White-Collar Workers in the AI Spotlight

Unlike previous waves of automation that primarily affected blue-collar workers, AI's influence is increasingly felt by white-collar workers. These occupations often require higher education and command higher wages. The DEED LMI findings indicate that:

70% of jobs in occupations with the highest AI exposure have a median wage above $60,000 per year.

Over 75% of occupations typically requiring a bachelor's degree or higher fall into the highest exposure group.

Macht and Greiner’s Trends article includes a visualization that ranks occupations by AI exposure, alongside Minnesota wages and educational requirements, which you can explore online. Again, remember: exposure simply means the potential for change, whether it's augmentation, enhancement, or the creation of new roles.

Real-World AI: Genetic Counselors vs. Exercise Trainers

To illustrate the range of AI exposure, consider two very different occupations:

Genetic Counselors (High Exposure): These high-wage, high-education professionals can use AI for extensive data analysis. Nearly every task they perform has the potential to be enhanced by AI.

Exercise Trainers (Lower Exposure): While trainers can use AI for planning workouts or learning new techniques, the hands-on, real-time feedback, and encouragement required in their role currently limits direct AI interaction.

The key across all occupations is understanding how AI can benefit the role. As AI expert Charles Fadel, founder of the Center for Curriculum Redesign at the Harvard Graduate School of Education, wisely noted, "AI will not replace most jobs anytime soon. But one thing is sure, workers with AI will beat those without AI." It’s about being the person who knows how to "do the laundry," not just the "washing machine."

Industries and Regions: A Patchwork of Impact

Our analysis also revealed AI exposure across various industries. Unsurprisingly, sectors like professional and technical services, management of companies, manufacturing, healthcare and social assistance, finance and insurance, and educational services are most likely to be impacted.

Education stands out. Not only is it an industry highly exposed to AI, but educators are also on the front lines of teaching students how to use and benefit from it. Some educators are wary, focusing primarily on plagiarism concerns. However, many educators also take the view that to prepare students for the work world, they need to learn with AI—building, questioning, solving, and creating—not just about it.

Geographically, metro areas tend to have higher AI exposure due to their concentration of technical jobs. Hennepin County, for example, has the highest exposure in Minnesota. However, it’s important to note that several smaller counties in Greater Minnesota with high concentrations of education and healthcare employment also rank highly. Each local economy is unique.

Preparing for a Transformed Future

In summary, AI is profoundly transforming tasks across industries and geographies, bringing both optimism and concern. While AI promises increased efficiency, innovation, reduced tedious work, and new job opportunities, worries about widespread job displacement and inequitable economic effects persist.

This is why understanding Minnesota’s occupational and industrial exposure to AI is crucial. It informs strategic workforce development, economic planning, and policy interventions. Like the internet before it, AI will fundamentally alter job skills and functions over time, but it doesn't mean those jobs will disappear.

Major employing industries in Minnesota, such as manufacturing, finance and insurance, and healthcare, are poised to benefit from AI. Yet, these same sectors are also at higher risk of disruption, especially in traditionally stable white-collar roles.

The central challenge lies in preparing our workforce through education, retraining, and robust support systems to navigate this transition smoothly. The goal is to ensure AI's benefits are widely shared while mitigating economic disruption. For Minnesota to thrive, our workforce must be equipped with the skills needed to adapt, and our educators, government, business, and community leaders must be ready to optimize the benefits of AI for the state's economy.