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How Will the Advent of GenAI Impact State IT Workforces?

A new report from NASCIO explores the impact that generative artificial intelligence will have on state government tech employees, as states move independently with regulation and implementation.

Illustration of robot on the left at desk on top of stairs with humans climbing up the stairs toward the robot.
The rise of generative artificial intelligence (GenAI) may unlock new productivity levels and other benefits for government, according to a report released Wednesday by the National Association of State Chief Information Officers (NASCIO).

The report follows other related research from the organization, including a December report that placed artificial intelligence in the top three priorities for government IT leaders and a December resource outlining key guidance for states as they implement AI tools. Many experts now expect AI will transform work.

That is the topic NASCIO set out to explore, surveying 49 state CIOs and conducting interviews to understand how IT leaders feel about AI in the workforce. The overall sentiment was an optimistic one, with CIOs underlining potential for improved productivity, increased automation, improved service delivery and greater analysis opportunities.

The message is clear: GenAI is expected to have a considerable impact on workforce trends.

The report states that the combination of GenAI with other automation tools may increase annual productivity growth 3 percent to 4 percent by 2030. The report cites McKinsey Global Institute (MGI) research, which found that automation could affect up to 30 percent of work hours in the U.S. economy by 2030.

Rather than replacing jobs, the report found that leaders expect GenAI to act as an assistant that can help augment abilities, noting that there is little anxiety about job replacement from the CIOs interviewed. Similarly, the MGI research finds automation likely to enhance work in the areas of STEM, creative, business and legal professions, rather than causing job displacement.

On the subject of job replacement, while the majority of respondents felt GenAI would cause no change in CIO-related workforce numbers, more than a quarter believed they would actually need to increase numbers to implement and manage GenAI tools. In fact, about 20 percent of state CIOs expect a 1 percent to 10 percent increase in their state government’s tech workforce as a result of GenAI adoption.

However, more than half of respondents cited a skills shortage as the main barrier to seeing the positive impacts of GenAI. A major trend of reskilling and upskilling to combat this shortage is expected.

In addition to skills shortages, data quality is another challenge facing states as they prepare for successful implementations and scaling. Other barriers include budget limitations and concerns about security, privacy and ethics.

The report offers a path forward for states looking at AI. It urges states to consider four areas: talent planning, talent attraction and onboarding, talent development, and talent management. The report further suggests that states may need to expand or evolve their workforce development initiatives and hiring practices.

In the area of talent planning, the report recommends states identify current and expected skills to develop forward-looking workforce plans. In terms of talent attraction and onboarding, the report suggests governments widen the talent pool with competency-based hiring. With regard to talent development, the report proposes the creation of training plans. Finally, for talent management, the report recommends the creation of attractive career pathways to help employees develop their skills and impact communities.

Nonetheless, states are moving forward with GenAI: 92 percent of states are developing GenAI frameworks and policies, and 80 percent are working with industry experts to understand the technologies. More than half of states are investing in training programs. Only 4 percent have not taken any steps to advance GenAI.

The report details current GenAI use cases in state government, which include customer service, code creation, document generation, testing and data management. The report concludes that, for the states with risk management guardrails in place, CIOs can focus on scaling GenAI to improve work efficiencies.