AI’s champions insist the technology will “change” jobs and “evolve” jobs, and as a result work will be more interesting and satisfying than it is today. Even if there’s a net loss in jobs in the near term, they say, the workforce is shrinking, so over the years the number of jobs eliminated will be relatively small and painless to the economy.
But there’s a rub. These arguments ignore the natural tendency of business leaders to save money by eliminating workers. Whether they’re public or private, companies aim to “run lean” while keeping their operations “efficient” and “productive.”
It’s true that the advent of automobiles and personal computers did more to change jobs than end them. That’s fine as long as you’re talking about efficiency and productivity, but it ignores the very real consequences of those transformations. As their customer base dwindled, blacksmiths still had to provide for their families and pay for their houses. And learning a new trade took time.
On top of that, most employers don’t think very deeply about history or the economy outside their industry. Their perception of the labor market is tailored to see the labor pool as they want it to be, not how it actually is. That’s why you see job ads seeking 10 years of experience with generative AI or entry-level candidates with five years of experience.
As Business Insider notes, speculation about AI’s impact on jobs has been going on since the technology hit the mainstream in 2023. Today, we’re hearing more about now AI improves about efficiency and productivity at the same time business leaders open up about their quest to reduce headcount.
Saying What They Mean
Recently, Amazon CEO Andy Jassy acknowledged that AI will shrink the company’s workforce over the next few years. While workers will be needed for new positions, he said, “it’s hard to know exactly where this nets out over time” and “we expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company.”
Meanwhile, AI companies enthusiastically speculate about the impact their products will have on jobs. For example, Anthropic CEO Dario Amodei has said AI could eliminate half of all entry-level jobs for knowledge workers in the coming years. That’s disconcerting when more companies talk about cutting their white-color workforces. According to The Wall Street Journal, the white-collar workforce of American public companies has shrunk by 3.5% since 2022.
“Adding talent, once a sign of surging sales and confidence in the future, now means leaders must be doing something wrong,” the Journal said. Executives want their employees to do more with less. Jassy recently told investors that the best leaders “get the most done with the least number of resources required to do the job.”
If anything, the economy rewards companies who think along these lines. As the Journal notes, all of today’s workforce reductions have coincided with “a surge in sales and profits.” As a result, there’s been “a fundamental shift” in how business leaders regard their workforces.
A Vicious Circle
Today, deciding whether a machine can take on a task is the first step employers take when they’re deciding whether to add resources. According to the Journal, some CEOs have said future hiring will require managers to first show the work couldn’t be automated.
All of this uncovers an inherent conflict: On the one hand, by taking on rote tasks AI allows workers to spend their time doing more interesting and strategic things. On the other, people will have more things to do and less resources to do them with. “Their ability to do deep work and really focus goes down consistently because they’re endlessly distracted and now they’re doing the work that three people did 10 years ago,” Joseph Fuller, a management professor at Harvard Business School, told the Journal.
Worse, eliminating workers is some companies’ primary goal. Mechanize, a San Franciso-based startup, wants to eliminate jobs entirely. “Our goal is to fully automate work,” co-founder Tamay Besiroglu told the New York Times. “We want to get to a fully automated economy, and make that happen as fast as possible.”
The media narrative implies that major disruption to the job market is inevitable. However, most experts say true transformation is a ways away. AI has yet to prove it can shoulder complex workloads or navigate complex systems, they point out, and AI only excels at single tasks. Even Mechanize realizes its vision of “full automation” will take decades to realize.
So far, relatively few people have dug into the true ramifications of using automation to reduce the size of the wider workforce. Some people contend AI will create so much money, laid-off workers will be able to maintain their lifestyle through an approach like universal basic income. The details they offer, however, are scant.
AI’s advocates say it’s all to the good – whatever “it” is. “If society as a whole becomes much wealthier, then I think that just outweighs the downsides of people losing their jobs,” Mechanize co-founder Matthew Barnett said in the Times.
In other words, the concerns about living will sort themselves out. Somehow.