How AI will transform the workforce

Vanguard's Global Chief Economist Joe Davis predicts AI will be the most disruptive technology to alter work since the personal computer—but disruptive doesn't mean dystopian. Research from Vanguard examining 800 occupations found that approximately 25 per cent of current working hours are spent on tasks that will be automated by AI, with the average automation rate across jobs expected to exceed 20 per cent by 2035—equivalent to freeing up one day of work per week.

However, for 80 per cent of jobs, AI's impact will result in augmentation rather than elimination, with workers experiencing approximately 43 per cent time savings. The technology is expected to serve as a "copilot" introducing efficiency to repetitive tasks while allowing professionals to focus on higher-value activities.

Vanguard estimates for time savings due to AI for over 800 occupations; 73% of the analysed occupations contain tasks that are complementary to AI and are estimated to see more than 20% in time savings. Source: Vanguard calculations based on data as of July 2023 from the Bureau of Labor Statistics and the Occupational Information Network.

The research suggests roles including nurses, physicians, teachers, pharmacists, HR managers, and financial advisers will see AI complement their expertise rather than replace it. Davis draws parallels with the personal computer revolution: fund accountants in the 1980s performed highly manual, paper-based calculations—one accountant per mutual fund. Today those same roles exist but are spent on higher-value activities, and AI is predicted to have a similar influence.

The research also emphasises that critical thinking will become an essential differentiator, as AI handles non-critical tasks while uniquely human cognitive skills remain valuable.

Source: Davis, J. 2025. AI's impact on productivity and the workforce. Vanguard.