Will AI Create Or Kill More Middle-Class Jobs? - Free Websites, Share News And Posts Publicly

WED, MAY 10, 2023

Will AI Create or Kill More Middle-Class Jobs?

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IBM came out with artificial intelligence news at its Think event yesterday, and Alphabet’s set for its own announcements today at Google I/O. AI’s effect on workers, though, still up in the air. Will AI create more middle-class jobs, or kill them? Jon Fortt is here to weigh in.

JON:

“It’s going to end up creating more jobs than it destroys.

AI is the automation of mental labor, the same way the industrial revolution brought us automation of physical labor through machines. In that process, yes, some jobs will go away, just like we don’t have as many weavers or carriage drivers employed today as we did 200 years ago. But we do have a lot more clothing stores and car salespeople.

In a report in March, Goldman Sachs estimated two out of every three U.S. jobs will have some exposure to AI, especially in administrative and legal work.

Why is this going to be a good thing for middle-class workers, on balance? It will unlock creativity. A software CEO this week told me his customers use AI to scan new legal documents and make sure they have all of the correct standard provisions. A human will still need to look things over, but it will be faster. Does that mean less demand for lawyers? If deals are getting done that much more quickly, and deal volume increases, maybe not.

It’s always hard to see the opportunities new technology will create when we’re at the beginning of the disruption. E-commerce was going to destroy local merchants and unique crafts, until Etsy and Shopify emerged to amplify the crafty and bespoke. Creativity finds a way.”

Sometimes technology does gut whole industries, though. Look what happened to travel agents.

JON:

“On the other hand, AI is going to kill more middle-class jobs than it creates, for a basic reason:

The kinds of jobs it’s going to kill are jobs people have right now. The jobs it’s going to create are the ones that companies are trying to hire for, but can’t fill.

A good example: Google announcing this week that starting next month at a Wendy’s in Columbus, Ohio, an AI chatbot will take orders at the drive-thru window. Industry jobs eliminated if it works? Tens of thousands at least: McDonald’s alone has more than 12,000 drive-thrus in the United States. Jobs AI drive-thru will create? I’m sure Google will need a crack team of 10 engineers to tune that AI to get better at upselling you the ice cream on a hot day.

I know we like to traffic in this myth that technological progress always makes more jobs for everyone. Tell that to Buffalo or Scranton. It doesn’t. Advances that benefit some people in the economy can leave others devastated for generations.

A big story of the last 30 years was the flipside of globalization, where American factory workers found themselves replaced by cheaper labor offshore. The next 30 could be the flipside of AI, where American knowledge workers find themselves replaced by AI bots trained on the archived data of our best emails and phone calls.”

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*Why LinkedIn? On the Other Hand is about civil debate that illuminates the relevant facts. We’ve found that LinkedIn does a good job fostering that kind of environment.

On the Other Hand is Jon Fortt’s weekly segment on Squawk Box, Thursdays in the 7 a.m. ET hour. He’s been writing it just about every week since August 2020. The second (or first) argument each week isn’t necessarily the one Jon agrees with. He just makes an honest effort to construct the best argument he can for each side.

When he’s not debating himself, Jon co-anchors Overtime at 4 p.m. alongside Morgan Brennan. Jon also researches and writes the weekly Working Lunch segment on Power Lunch, Fridays in the 2 p.m. ET hour, where he introduces viewers to founders and CEOs through their origin stories and strategic goals.