AI’s impact on the labor market is still ‘premature’: Economist

Yahoo Finance Video and Josh Lipton

Tue, February 17, 2026 at 4:00 AM GMT+9

In this video:

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Numerator chief economist Leo Feler and Prime Capital Financial portfolio manager Clayton Allison weigh in on whether AI adoption has started to show up and impact the US labor market, especially as more Big Tech companies lean heavier into artificial intelligence and data center spending.

To watch more expert insights and analysis on the latest market action, check out more Market Domination.

Video Transcript

00:00 Speaker A

Leo, what impact, if at all, is AI having on this labor market?

00:05 Leo

So, it’s starting to have an impact, right? I I I think it’s still premature to say that it’s having some kind of major impact. Um and and basically the signal that I will take from this latest jobs report is that where we’ve seen uh the unemployment rate increase is really for those with a bachelor’s education or higher, right? That tends to tell me that it’s the, uh, you know, the more educated, you know,

00:32 Leo

sitting in front of a computer type of jobs that are going to be affected. If you look at where we are hiring, it’s in health care and social services, right? AI is not going to transform whether or not there’s going to be a nurse taking your blood anytime soon. AI is not going to transform whether there’s a construction worker, you know, putting windows and siding on your house anytime soon. Those sides of the economy are more protected, but we are seeing weakness exactly in the types of sectors and in the type of workers, uh, who are likely to be impacted by AI.

01:01 Speaker A

Clayton, let’s stick with AI. Those AI disruption fears are front and center. I’m just looking at the IGV Clayton, the software sector ETF, we’re down again today. We’re down about 20% already this year. What do you make of that? Is that is that fair? Is it reasonable? Do you think that’s overblown? Do you see an opportunity in software, Clayton?

01:18 Clayton

Yeah, I do think that there’s an opportunity there. I think it might be partially overblown to say how much, you know, we’d have to dig in a little bit deeper to figure out where that, you know, new multiple is fair at. Now, a lot of the names that make up IGV are enterprise-wide solutions. It’s made up of Palantir, Microsoft, Salesforce. A lot of these are ingrained services at major Fortune 500 companies and enterprises. And I think a lot of these headline fears to where we’re pretty much painting with a broad brush that these businesses are going to go out of business seemingly overnight or their business models will become obsolete immediately. I think it’s a little bit overblown. We do like this as an opportunity tactically to add on this type of weakness in some of our more opportunistic models.

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