AI job losses set to rein in office demand in developed Asia-Pacific economies: report

The CBRE report offers a specific, quantitative estimate for how AI adoption might influence office space demand. The projected slowdown in growth for occupied office space, from 18 percent to 13 percent by 2030 under a moderate-displacement scenario, suggests that while AI may not halt expansion, it could temper its pace. This distinction helps clarify the potential scale of AI's impact on a tangible market.

The report's differentiation between developed and developing markets in the Asia-Pacific region highlights varying exposure to AI-driven job displacement. Developed economies, including Hong Kong, Singapore, Japan, South Korea, Taiwan, Australia, and New Zealand, face a higher vulnerability rate for office jobs at 3.9 percent. This contrasts with developing markets like mainland China, India, and Southeast Asian nations, where the rate is 1.7 percent. This difference might reflect variations in economic structure, technological adoption rates, or the nature of office work prevalent in these regions.

The analysis separates the impact of AI on job displacement from its broader productivity gains. CBRE's base case, which assumes productivity improvements without job displacement, forecasts higher office space growth. The reduction in this growth under a displacement scenario indicates that the market is sensitive to how AI integration affects employment figures, rather than just overall economic output. This suggests that the net effect of AI on real estate will depend on the balance between new demand generated by AI-driven growth and reduced demand from job automation.