The signaling breakdown is primarily a function of cost, and while in-person evaluation is going to be relatively more costly for candidates, thus acting as a better mechanism for selection on ability, it is also significantly more costly for potential employers. It depends on the expected payoff, whether a firm is willing to incur greater search costs for more certainty about candidate quality relative to less certainty in online applications or even the cost of not filling the position at all.
The adoption lag argument is valid but misses the selection effect. It's not about whether AI can technically replace your job. It's about whether your employer will choose to. Unemployment among 20-to-30-year-olds in tech is up nearly 3 points. Junior roles aren't being augmented. They're being skipped. Companies are hiring senior people with AI tools instead of junior teams. The displacement isn't happening through replacement. It's happening through non-hiring.
Why don’t firms simply switch to in person evaluation?
The signaling breakdown is primarily a function of cost, and while in-person evaluation is going to be relatively more costly for candidates, thus acting as a better mechanism for selection on ability, it is also significantly more costly for potential employers. It depends on the expected payoff, whether a firm is willing to incur greater search costs for more certainty about candidate quality relative to less certainty in online applications or even the cost of not filling the position at all.
The adoption lag argument is valid but misses the selection effect. It's not about whether AI can technically replace your job. It's about whether your employer will choose to. Unemployment among 20-to-30-year-olds in tech is up nearly 3 points. Junior roles aren't being augmented. They're being skipped. Companies are hiring senior people with AI tools instead of junior teams. The displacement isn't happening through replacement. It's happening through non-hiring.