Experts in the US are warning that artificial intelligence (AI) will lead to job losses and increased wealth inequality. They claim that AI and automation will create a “jobless future” where only those with the financial ability to access the technology will benefit, while others are left behind. They are calling for policies to address this, such as taxing capital gains, and providing retraining and unemployment insurance to those affected by job losses. They also suggest more support for small businesses and startups, as well as increased investment in education and job training.
ChatGPT is just the latest technology raising concerns that it will wipe out the jobs of millions of workers, whether they are copywriters, Wall Street traders, salespeople, writers of basic computer code, or journalists.
But while many workforce experts say fears that ChatGPT and other artificial intelligence (AI) technologies will skyrocket unemployment are overdone, they point to another fear about AI: that it will increase the already huge Income and wealth inequality in the US will be exacerbated by the creation of a new wave of billionaire tech barons, who at the same time are crowding out many workers from better-paying jobs.
Like many disruptive technologies before it, AI is likely to wipe out jobs. But as in the past, experts argue, AI will likely offset much of that by boosting new job creation and enhancing many existing ones. The big question is: which jobs?
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“AI will wipe out many current jobs, as has all previous technologies,” said Lawrence Katz, a Harvard labor economist. “But I have no reason to believe that AI and robots will not further change the job mix. The question is: will the changed occupational mix exacerbate existing inequalities? Will AI increase productivity so much that while it displaces many jobs, it creates new ones and raises living standards?”
Anu Madgavkar, director of employment research at McKinsey Global Institute, estimates that one in four workers in the US will use more AI and technology in their job. She said that 50-60% of companies say they are pursuing AI-related projects. “So, one way or another, people need to learn to work with AI,” Madgavkar said.
One way or another, people need to learn to work with AI
Anu Madgavkar
While past rounds of automation have hit factory jobs hardest, Madgavkar said AI will hit white-collar workers hardest. “It’s increasingly going into office work and into customer service and sales,” she said. “These are the job categories that will have the highest rate of automation and the greatest displacement. These workers have to work with it or switch to other skills.”
In other words, many office workers could face relegation.
Workforce pros are asking many questions about AI: Will it displace many call center agents or just make those agents more productive by giving them the information they need quickly while they’re talking to customers? Will AI displace radiologists because it can read cancer scans, or will it help radiologists by allowing them to focus on more complicated, nuanced scan interpretation problems? Will AI be able to replace some journalists, writing stories about baseball games or the daily ebb and flow of Wall Street?
Some HR experts say AI and other emerging technologies will hurt mid-level white collar jobs more than low-paying, physically-intensive jobs. McKinsey’s Madgavkar said it will be difficult for AI or robots to do the job of janitors. In the hospitality industry, she said, new technology could take customer orders, but “we’re not going to see a lot of little robots bringing the food to a specific table.”
In law firms, AI could eliminate some legal jobs by being able to create initial drafts of business contracts. But AI could also allow paralegals to oversee the preparation of draft contracts, and that increased responsibility could mean higher pay for paralegals.
“If you make workers more productive, you want workers to make more money,” said William Spriggs, an economics professor at Howard University and chief economist for the AFL-CIO, the country’s main union federation. “Companies don’t want to have a discussion about sharing the benefits of these technologies. They would rather have a discussion to scare you to death about these new technologies. They want you to admit that you’re just grateful to have a job and you’re going to pay us peanuts.”
Spriggs noted that as a wave of automation swept through the auto industry from the 1950s through the 1970s, “the UAW said to Ford and GM, ‘We’re a lot more productive and you’re a lot more profitable. This gave the workers a lot more money.”
David Autor, an economics professor at MIT, is cautious about making predictions about ChatGPT and AI. “There’s just a tremendous amount of uncertainty,” he said.
The concern is: will AI diminish the value of many skills and make work more of a commodity?
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But he’s not worried about the US running out of jobs. “If anything, we don’t have enough people for jobs right now,” he said. “I’m concerned about the changing mix of jobs.” He expressed concern that by eliminating some middle-class jobs and cutting some jobs, AI will move many workers into lower-paying jobs like hospitality. “The concern is: will AI diminish the value of many skills and make work more of a commodity?”
New technologies like AI often create jobs that no one could have predicted – before the invention of the computer, who would have predicted the job of computer programmer? Labor force experts say that AI will create more jobs for engineers and certain types of managers, and that any AI-induced job losses could be offset by an increase in the number of healthcare jobs as the overall population ages. AI could call for an increased retraining system, for example to prepare a laid-off salesman for a hospital job.
Juliet Schor, an economist at Boston College, said it would be far better if employers cut employees’ hours to maybe three or four days a week instead of five, rather than firing people for AI. “Hour reduction is really a far better way to respond to the technological change that is displacing work,” Schor said. She expressed fears that AI could create a large pool of unemployed Americans, and even with a Universal Basic Income system “it would create inequality between people who have jobs and people who don’t.” That is a big problem.”
Julie Shah, an MIT professor who leads the Interactive Robotics Group at MIT’s Computer Science and Artificial Intelligence Laboratory, said she’s working with employers to get them using AI and robots to “augment and expand workers.” improve rather than replace them”. She said some employers want to use robots to have a lights-out factory with no human workers, while other companies want robots to work with humans to make them more efficient — and have human workers on hand to brainstorm future ideas propose innovations.
Shah pointed to a study of large French companies adopting robots; These companies increased overall employment even as their domestic competitors reduced their workforce. She also cited a study of Canadian companies that began using robots and ultimately reduced the number of middle managers while increasing the number of production workers. She found that in the US, some companies were introducing robots and offering higher wages while having fewer jobs overall.
“These technologies don’t lead to one future, they lead to many possible futures,” Shah said.
Harvard’s Katz is also concerned about the impact of AI on income inequality. “It’s likely that work as a percentage of income will continue to fall as many tasks become automated,” he said.
Katz said a big issue is who will share the gains if AI sees significant productivity growth and how those gains will be shared. “How much has to come through redistribution policies?” he asked. “If it’s really good and massively increases productivity, even if workers get a smaller slice of the pie, they could end up with higher incomes.”
However, given the current circumstances, those gains are unlikely to trickle down to US workers. “Having a greater say for workers and their representatives in this process is an important element in adapting to these changes. This has happened in countries with stronger unions and works councils. That’s an area where we’ve fallen behind in the US,” Katz said.
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