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I'm an atypical case, since I work at a non-profit and I spend a lot of time researching case law (I'm told by a lot of private practice friends that they haven't typed a casr citation into westlaw or lexis in years), but Westlaw's built-in AI has largely replaced summer associates as my go to source of info for "hmm, I wonder" type questions. Simple queries where I just want a quick sniff test to see if the theory I'm spitballing is precluded by some obvious bit of black letter law, or a short summary of how a particular jurisdiction handles some procedural issue. I get an answer of questionable veracity I'll need to verify and develop before getting any value out of, but the AI gives it to me in 45 seconds rather than 3-4 days. So I have to make a conscious effort to inefficiently include interns and new attorneys in things for training purposes, because it probably takes about a year before a new lawyer outperforms the AI (at current AI capabilities). We're not hiring fewer of them yet, since the higher-ups are mindful of maintaining the talent pipeline and don't want to be scrambling to find mid-levels in five years, but they do have less to do.
I'm adamant about never using AI for drafting assistance, but I notice my colleagues increasingly using it to generate first drafts of things like emails and op-eds. Haven't seen any open use of it on actual legal documents yet.
As far as labor force impact, I think it's very practice-area-dependent. The more your practice involves spreadsheets and insurance paperwork, volume-dependent mad libs-type work, the more impact you'll feel. If you're heavily reliant on tech companies or other clients making "AI first" pushes, it's probably pretty rough. I worry for our legal secretaries. Litigators are pretty safe. As long as judges require flesh and blood people standing in court rooms (or at least on zoom) and continue to ban the unauthorized practice of law, there's only so much automation that can really take place. Doctors and lawyers have spent over a century erecting walls and moats to protect their professions from competition from the dirty proles; we're not submitting to the robots without a fight.
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