Core Insights - A study by MIT reveals that artificial intelligence (AI) could replace 11.7% of the U.S. labor market, equating to a wage scale of $1.2 trillion in sectors like finance, healthcare, and professional services [1][2] - The research utilizes the "Iceberg Index," a labor simulation tool developed by MIT and Oak Ridge National Laboratory, to model interactions among 151 million workers and assess the impact of AI [1] - The index highlights that the most affected sectors are often overlooked by traditional automation predictions, with significant wage impacts in human resources, logistics, finance, and administrative roles [2] Labor Market Impact - The study indicates that the visible job losses in tech and IT sectors account for only 2.2% of the total wage impact, approximately $211 billion, while the hidden impacts in other sectors are much larger [2] - The Iceberg Index is not a predictive tool for job losses but provides a skills-centered overview of what current AI systems can accomplish, aiding policymakers in exploring hypothetical scenarios before making financial commitments [2] Collaboration with State Governments - Researchers are collaborating with state governments, including Tennessee, North Carolina, and Utah, to validate the model using local labor data and to develop policy scenarios [3] - Tennessee has already incorporated the Iceberg Index into its official AI workforce action plan, while Utah is preparing a similar report based on the model [3] Interactive Simulation Environment - The research team has created an interactive simulation environment that allows states to test various policy levers, such as reallocating workforce funds and adjusting training programs [4] - The Iceberg Index serves as a "sandbox" for decision-makers to prepare for the impacts of AI on labor, enabling them to identify risk hotspots and prioritize training and infrastructure investments [4]