- Generative AI like ChatGPT could impact millions of jobs in the future.
- Businesses are expected to leverage AI to improve productivity and profits.
- The introduction of AI could mean higher wages for workers or put them out of work altogether.
It is becoming clear that in the not-too-distant future, AI will have a growing potential to improve productivity and profits in enterprises.
The biggest question now is whether workers will share in that wealth once these changes come into force.
In the next few years, generative AI, including ChatGPT, could destroy (but not necessarily replace) 300 million full-time jobs worldwide, according to Goldman Sachs. Experts expect AI to primarily affect white-collar jobs.
The introduction of AI could make some workers more productive, spend less time on tedious tasks, earn higher wages, and even enable them to work four days a week. workers could face more competition, get lower wages, or even have these technologies replace their jobs. work.
“It’s a new game, but I don’t know what that new game will be like,” Massachusetts Institute of Technology economist Daron Acemoglu previously told Insider.
Insiders asked AI experts about the key factors that will determine how this “game” plays out for U.S. workers, and how to ensure the game plays out in their favor.
Increased productivity should lead to higher wages, but not always
Goldman Sachs analysts estimated in March that nearly two-thirds of U.S. workers could be more productive with the use of AI. Goldman Sachs senior strategist Ben Snyder told CNBC last week that productivity gains in AI could boost S&P 500 earnings by more than 30% over the next decade.
Historically, increased employee productivity has been tied to higher employee salaries, so in theory, Americans might one day appreciate technologies such as ChatGPT that have significantly increased their salaries.
But the money saved by increased productivity doesn’t always go into workers’ pockets. According to the Economic Policy Institute, a left-wing think tank, since 1979, U.S. labor productivity growth has outpaced hourly wage growth by 3.7 times, with stagnant minimum wages, a decline in labor unions, and an increase in labor unions contributing to the gap. It is said that there is. In particular, the impact of anti-monopoly policies can be considered.
Some experts say this dynamic has contributed to rising economic inequality over the past few decades. And if AI brings about a future that enriches managers and investors but displaces workers, recent progress on inequality could be reversed.
Moreover, while many companies in the S&P 500 may be well-positioned to reap the benefits of the AI boom, small businesses and their employees may not enjoy the same benefits, says the University of Oxford. economist Carl Benedict Frey told Insider.
“AI will make superstar firms more productive and profitable, but those gains may come at the expense of others,” he said. “Think of Amazon, which has expanded significantly using both AI and robots, while local retailers are paying the price.”
Not all workers, even those at large companies where AI has been effectively deployed, will benefit from these increased profits, studies the impact of AI on the U.S. workforce. Mark Muro, a senior researcher at the Brookings Institution, told Insider.
“Worker experience can be heavily influenced by how companies are adopting these technologies,” he said. “Is it being introduced in the spirit of improving processes and producing more and better results, or is it being used roughly just to fire workers? It’s the difference between ‘bad AI’.”
“Where the profits go depends on how the AI is used,” he said. “When AI is used to automate existing tasks, or simply to monitor employees and turn them into dancing robots, the benefits go to the owners of the capital. On the other hand, if AI is used to innovate and to create new things, products and even industries will increase demand for workers and drive higher wages,” Frey added. .
Many fear that the rise of AI will lead companies to layoffs
For Americans to realize the benefits of AI productivity gains, they must be working and not being replaced by these technologies.
Sam Altman, CEO of ChatGPT developer OpenAI, admitted in March that creating ChatGPT was “a little scary” and warned that many jobs could be “lost”. . In a survey Microsoft conducted of his 31,000 people around the world in February and March, he said 49% of employees who responded said they were worried about losing their jobs to AI. I answered yes.
Earlier this month, IBM CEO Arvind Krishna told Bloomberg that 30% of the company’s non-customer-facing roles — roughly 7,800 jobs — could be replaced by AI over the next five years. However, the company has no immediate plans. Let these workers go. Meanwhile, British telecoms giant BT Group said it plans to cut up to 55,000 jobs by 2030, at least 10,000 of which could be replaced by some form of artificial intelligence. rice field.
Also, as AI technologies such as ChatGPT make it easier for people to write and code, today’s writers and coders may face more competition from ChatGPT-powered writers and coders for a limited number of jobs. There is a nature. Such dynamics could keep wages in check, according to Frey. .
Frey compares this to the introduction of ride-hailing companies such as Uber, which results in more drivers, more competition, and ultimately sees incumbent drivers experience “a pay cut of about 10% or so.” That’s what happened, he revealed in his research.
“Automation is not important in my opinion,” he said. “It’s about democratization and competition, which could lead to lower wages for some people in these occupations.”
AI could make people’s jobs easier and create new jobs
But there are also more optimistic predictions. Acemoglu said generative AI won’t replace many jobs, and some workers could take advantage of productivity gains to raise wages.
“We tend to underestimate how complex human jobs are,” he said, citing the potential for AI to complement rather than replace jobs such as journalists, managers and radiologists. , which could lead to higher wages for workers, he added.
The introduction of AI will not only replace jobs, but it may also create new jobs and, in some cases, give workers the opportunity to jump into new high-paying roles.
A study led by Massachusetts Institute of Technology economist David Autor found that in 2018, 60% of workers who responded had jobs that didn’t exist in 1940. According to Goldman Sachs economists, this suggests that “technology-driven creation of new positions” has driven about 85% of job growth over the past 80 years.
AI can be a boon to workers looking to learn how to use it to increase their productivity.
Many experts believe that AI adoption will be widespread, improving the lives of many workers and making them wealthier. Altman said a universal basic income could help people compensate for jobs replaced by AI and encourage them to pursue more creative jobs.
“AI will be the biggest force in the economy, making people richer than they’ve ever seen,” Altman said. Tweets of April.
And there are ways you can prepare your workforce to thrive in the AI boom. Familiarizing himself with this technology and thinking about how it can be applied to his work is one way he prepares.
“Many workers’ experience will depend on their ability to teach or use AI,” Muro said. “Can they leverage it and give prompts that produce valuable results and increase productivity? They can use his ChatGPT to create high quality business reports and client notes mosquito?”
“Employers will want to work with enlightened users,” he added. “They will be given more chances to grow and adapt.”
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