According to a new study, Generative AI tools like ChatGPT are already reshaping the job market with the demand for freelance jobs vulnerable to automation and requiring less human involvement has dropped by 21%.

The study, conducted by researchers Ozge Demirci, Jonas Hannane, and Xinrong Zhu from Harvard Business School, the German Institute for Economic Research, and Imperial College London Business School, analyzed 1,388,711 job posts on a “leading global online freelancing platform” from July 2021 to July 2023.

The study used a machine learning algorithm to categorize job posts based on their descriptions into three types: manual-intensive, automation-prone, and image-generating jobs. It then analyzed the impact of Gen AI tools on demand for these job types.

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The results showed a 21% decline in demand for automation-prone roles just eight months after ChatGPT’s release in late 2022.

“Writing is the job category most affected by ChatGPT, followed by software, app and web development, and engineering,” the study said adding that it found a 17% more pronounced decrease in demand for graphic design and 3D modeling jobs following the release of Image-generating AI technologies.

“In the long run, there might still be net job growth as a result of AI, potentially attributed to productivity effects and reinstatement effects.”

“Our findings also suggest that freelancers with certain skills may face more competition after the introduction of GenAI tools.”

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The study noted that, given the already intense competition for job opportunities in online labor markets, the growing substitutability between freelancer jobs and generative AI could further reduce earnings in the short term.

While the study found that tasks easily automated by AI, such as routine and repetitive work, are expected to decline in demand, the findings also suggest that new skills may emerge to effectively incorporate GenAI tools into job tasks.

“Skills that complement AI, such as critical thinking, creativity, and emotional intelligence, may become more valuable and in demand,” said the study.

The study emphasizes that it focuses on the short-term impacts, with the long-term effects potentially differing.

“In the long run, there might still be net job growth as a result of AI, potentially attributed to productivity effects and reinstatement effects.”

The authors of the study have written a more extensive look over at Harvard Business Review, here.