AI and Jobs Disruption
14:37 Share

Today on the AI Daily Brief, will AI empower us, replace us, or all of the above? The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI. To join the conversation, follow the Discord link in our show notes.

Hello, friends. Welcome back to another long reads episode of the AI Daily Brief. Today's one of those interesting days where I saw a bunch of opinion pieces that kind of have a similar theme. And it's the resurgence of this anxiety around how much artificial intelligence is likely to displace us from a job or employment perspective. We're

We're going to read some selections of a couple different pieces on this, and then come back and discuss it all. Obviously, it will be the AI version of myself reading all of these. And first up is an opinion piece by Peter Coy called Will Artificial Intelligence Replace Us or Empower Us?

I took three Waymo rides this month while in San Francisco for an economics conference. The smooth trips made for a haunting vision of the potential future of artificial intelligence. Inside the cabs, there was gentle New Age music and no one in the driver's seat. Such could be the future of the economy in general if artificial intelligence substitutes for human labor in more and more occupations.

The unemployed masses could come to depend on the charity of billionaires and trillionaires who own the means of intellectual production. But AI could also be designed to empower people rather than replace them, as I wrote a year ago in a newsletter about the MIT Shaping the Future of Work initiative. Which of those AI futures will be realized was a big topic at the San Francisco conference, which was the annual meeting of the American Economic Association, the American Finance Association, and 65 smaller groups in the Allied Social Science Associations.

Eric Brynjolfsson of Stanford was one of the busiest economists at the conference, dashing from one panel to another to talk about his hopes for a human-centric AI and his warnings about what he has called the Turing Trap. Alan Turing, the English mathematician and World War II codebreaker, proposed in 1950 to evaluate the intelligence of computers by whether they could fool someone into thinking they were human.

His imitation game led the field in an unfortunate direction, Brynjolfsson argues, toward creating machines that behaved as much like humans as possible instead of like human helpers. Henry Ford didn't set out to build a car that could mimic a person's walk, so why should AI experts try to build systems that mimic a person's mental abilities? Brynjolfsson asked at one session I attended.

Other economists have made similar points. Darren Akamoglu of MIT and Pascal Restrepo of Boston University use the term so-so technologies for systems that replace human beings without meaningfully increasing productivity, such as self-checkout kiosks and supermarkets. People will need a lot more education and training to take full advantage of AI's immense power so that they aren't just elbowed aside by it. In fact, for each dollar spent on machine learning technology, companies will need to

Companies may need to spend $9 on intangible human capital, Brynjolfsson wrote in 2022, citing research by him and others. A big question is who will pay for all that education? Employers fear that if they train their workforce, the employees might take their in-demand skills to a competitor, and the workers may not be able to afford it on their own.

This implies, Brynjolfsson wrote, that governments should directly provide this training or provide incentives for corporate training. Empowering workers might seem utopian, but it's the historical norm. Waymo aside, most technologies over the centuries have made people more powerful and effective, mechanized looms, or created new products, nylon.

Interestingly, Waymo's parent, Alphabet, is doing some of the coolest work on AI that extends human reach. Two researchers at Google DeepMind in London shared the 2024 Nobel Prize in Chemistry with an American scholar for predicting the structure of proteins with the help of artificial intelligence.

Various units of Google are also working on better weather forecasts, flood prediction and quantum computing. James Mnika, the senior vice president for research, technology and society at Google, who spoke at the San Francisco conference, said last year, the flood prediction system was first tested in Bangladesh and is being used in 100 countries with a combined 700 million people.

Google is also using AI to reduce jet vapor trails and detect diabetic retinopathy, a preventable cause of blindness. Google is putting much of its energy into agentic systems, meaning intelligent agents working for people, Mnjica stressed at the conference. A day may come when AI is so powerful that it's better at every conceivable human activity, including child-rearing, according to Nick Bostrom, a Swedish-born philosopher whose book I covered in a newsletter last year. But there's no reason for humanity to race toward that dystopian outcome.

As Brynjolfsson wrote in his 2022 essay, the future is not preordained. Today's episode is brought to you by Vanta. Trust isn't just earned, it's demanded. Whether you're a startup founder navigating your first audit or a seasoned security professional scaling your GRC program, proving your commitment to security has never been more critical or more complex. That's where Vanta comes in.

Businesses use Vanta to establish trust by automating compliance needs across over 35 frameworks like SOC 2 and ISO 27001. Centralized security workflows complete questionnaires up to 5x faster and proactively manage vendor risk. Vanta can help you start or scale up your security program by connecting you with auditors and experts to conduct your audit and set up your security program quickly. Plus, with automation and AI throughout the platform, Vanta gives you time back so you can focus on building your company.

Join over 9,000 global companies like Atlassian, Quora, and Factory who use Vantage to manage risk and prove security in real time.

For a limited time, this audience gets $1,000 off Vanta at vanta.com slash nlw. That's v-a-n-t-a dot com slash nlw for $1,000 off. If there is one thing that's clear about AI in 2025, it's that the agents are coming. Vertical agents buy industry horizontal agent platforms.

Agents per function. If you are running a large enterprise, you will be experimenting with agents next year. And given how new this is, all of us are going to be back in pilot mode.

That's why Superintelligent is offering a new product for the beginning of this year. It's an agent readiness and opportunity audit. Over the course of a couple quick weeks, we dig in with your team to understand what type of agents make sense for you to test, what type of infrastructure support you need to be ready, and to ultimately come away with a set of actionable recommendations that get you prepared to figure out how agents can transform your business.

If you are interested in the agent readiness and opportunity audit, reach out directly to me, nlw at bsuper.ai. Put the word agent in the subject line so I know what you're talking about. And let's have you be a leader in the most dynamic part of the AI market. Hello, AI Daily Brief listeners. Taking a quick break to share some very interesting findings from KPMG's latest AI Quarterly Pulse Survey.

Did you know that 67% of business leaders expect AI to fundamentally transform their businesses within the next two years? And yet, it's not all smooth sailing. The biggest challenges that they face include things like data quality, risk management, and employee adoption. KPMG is at the forefront of helping organizations navigate these hurdles. They're not just talking about AI, they're leading the charge with practical solutions and real-world applications.

For instance, over half of the organizations surveyed are exploring AI agents to handle tasks like administrative duties and call center operations. So if you're looking to stay ahead in the AI game, keep an eye on KPMG. They're not just a part of the conversation, they're helping shape it. Learn more about how KPMG is driving AI innovation at kpmg.com slash US. Second, we turn to the pages of the Financial Times for a piece by Rana Foroohar called AI is Taking the US in a Strange New Direction.

I've been skeptical that artificial intelligence will radically remake labor markets in the short term, in part because so much hype comes from the tech industry itself. But in the last couple of months, I've encountered some very diverse use cases for AI that have me thinking differently. First, a psychiatrist in New York told me how mental health professionals are beginning to use AI to track clients' word choices across sessions. Word choice can be an important factor in understanding mental illness and making diagnoses.

Previously, this was dependent on a therapist's own memory and perceptions. Now, AI-driven analytics will be, in his words, a game-changer in terms of how effectively patients can be diagnosed and treated.

Second, an investor told me about a company in the U.S., Axon, that is leveraging AI and proximity data. One product, called DraftOne, allows police in places such as Lafayette, Indiana to download body camera images, then push a few buttons to create a first draft of the incident reports that currently take up roughly 40% of their time. While other attempts at high-tech policing have come with unforeseen challenges, such as algo racism, markets are keen. Axon's stock is up 730% over five years.

Finally, weary after a long business trip, I recently got a massage in Anchorage, Alaska. My masseuse, who had dropped out of high school, had managed to turn her difficult life around in dramatic ways and wanted to write a memoir to inspire others. Discovering that I was a writer, she asked me to read her book proposal, which turned out to be as good if not better than many I've seen in high-end literary slush piles. Her co-author was ChatGPT.

Consider how many such anecdotes, reaching across geographies and industries, alongside the fact that productivity in the U.S. is finally on the rise after flatlining during COVID. Here may be multiple reasons for that, from low-wage immigration that allowed more skilled workers to move up the ladder into better jobs, to cyclical gains post-pandemic. But most experts agree that greater implementation of cutting-edge technologies such as AI is clearly playing some role in driving up productivity.

As a recent Apollo Economic Outlook note put it, the U.S. is experiencing a surge in corporate and research spending on the back of the AI revolution, a dynamic not seen in other developing nations or even China.

There are three key lessons to take from this. First, skepticism about how frothy the U.S. market in general, and technology stocks in particular are, is entirely understandable. But it's hard to see how Europe and many other countries would outperform relative to the U.S. if we are heading back to a period of technology disruption that is similar, if not exponentially more dramatic, than what we saw in the 1990s. Back then, investors will remember, the U.S. pulled ahead of Europe in terms of technology deployment and, as a result, in economic and market growth.

AI would seem to be putting that trend on steroids today. That leads me to lesson two. The fortunes of countries, companies, and individuals often diverge in periods of technological change. The term jobless recovery was coined after the 1990-91 recession because while stock prices, corporate margins, and GDP growth surged, employment growth lagged behind for longer than expected.

While unemployment is low in the U.S. today, it is notable that workers in areas ripe for disruption by AI, such as software development or middle management gigs, seem to be getting more redundancy notices.

It obviously takes time for job markets and people to adapt to technological change. Yes, as The Economist will tell us, new technologies eventually create new jobs. But as historians, sociologists, and social workers can attest, that doesn't mitigate the pain of those going through such big shifts. Nor does it prevent the disruptive political convulsions that can result.

The disruptions to manufacturing jobs, which represent only a little over 10% of employment in the U.S. and many EU countries, brought us Donald Trump and European populism. We are about to see up to 85% of the labor market disrupted to some extent by AI. What will that mean?

For a start, says Nobel laureate and MIT professor Darren Akamoglu today, as in the past, it's likely that the short- to mid-term gains from AI will be distributed unequally and will benefit capital more than labor. This brings us to lesson three. People on most rungs of the socioeconomic ladder are anxious about the future of work.

If the AI enthusiasts are right, it's difficult to see whose job won't be affected by the technology. That anxiety has big consequences. Jim Clark, founder of the recently launched New York-based Future of Employment and Income Institute, tells me that economic anxiety changes behavior, and that can create major political shifts. Think about the Luddites, for instance, whose name is still given to the backlash against tech, or on the upside, the social welfare state, which came out of the Industrial Revolution in Germany.

Investors, business leaders, and politicians should take this to heart. What's good for markets and even GDP growth today may not be good for politics or society tomorrow. At least not without big policy shifts to help buffer the coming disruptions.

Now, lastly, I was going to read an opinion piece in the Eurasia Review called Why We Shouldn't Be Concerned About AI Replacing Jobs. It's unfortunately a little short on details, but the main thrust is the quote, "...at one time in our history, 98% of our labor force worked on farms. That statistic is now down to about 3%. The economically illiterate way of looking at this alteration is to bemoan all those jobs lost in agriculture. A more rational one is to appreciate all the goodies made possible by this shift in employment."

And so jumping off there for this conversation, the thing that I want to leave you with is that I don't actually think that this is an either or.

What I mean specifically is that a bunch of things can be true simultaneously. It can, for example, be true that in the long run, AI replacing certain categories of human labor is likely to open up human labor for other types of productive purposes. It can, however, simultaneously be true that the bumpiness along that path and the short-term disruption could be enormous and challenging not only on an individual level, but on a societal level.

I've never made the mistake that I think Rana is making in her piece of being distracted by the hype so as to not take seriously the disruption here. But the point that she's coming to, that the displacement is going to have social and political implications, I think is true. It is cold comfort to a 60-year-old whose skills don't matter anymore that in the future jobs are going to be better when they have to deal with the next decade. That is going to create social upheaval, political upheaval, and it's going to be something that we have to deal with.

Now, there are lots of ways to deal with it, and these challenges are very clearly coming. But the only way that we'll get ahead of them is by actually taking them seriously.

Now, there's a whole separate conversation around exactly how this is going to play out. I've said before, and will I'm sure have lots and lots of context to talk about this year, that I think the disruption is going to be in categories of tasks rather than in categories of jobs in the short term. But still, I think there will be disruption. And so rather than spending all of this time debating around whether the future is great or terrible, it might be a better use of our time to focus on the medium term, where we will have much control over just how disruptive it will be.

For now, though, that is going to do it for today's AI Daily Brief. Appreciate you listening, as always. And until next time, peace.