A year ago, CEOs were warning that AI would be responsible for a job apocalypse in America. Ford Chief Executive Jim Farley said, “Artificial intelligence is going to replace literally half of all white-collar workers in the U.S," adding: "AI will leave a lot of white-collar people behind.”
A CNBC headline from about the same time stated, "AI is not just ending entry-level jobs. It’s the end of the career ladder as we know it."
Cats and dogs. Living together. Mass hysteria!
In 2016, Geoffrey Hinton, a British-Canadian computer scientist and cognitive psychologist, widely known as one of the "Godfathers of AI," said with total confidence, “People should stop training radiologists now,” he said. He predicted that within five years, computers would read X-rays and scans faster and more accurately.
The Washington Examiner's Nathan Leamer notes, "A decade later, that verdict has aged poorly. Radiologists are not obsolete. They are among the most sought-after doctors in America, with some compensation packages reaching $571,000." The Mayo Clinic’s radiology staff has grown by half during that decade, and will expand by 26 percent over the next three decades.
One of the most in-demand jobs in America is for radiologists, with the largest shortage on record.
Consider the news from the past week. The Washington Post reported how recent graduates blaming AI for a brutal entry-level market have the story backward. The real problem, recruiters and economists told the paper, is that the United States is barreling toward what may become the largest labor shortage in its history: shortfalls of nurses, physicians, engineers, pharmacists, construction workers, and airplane mechanics numbering in the tens and even hundreds of thousands. These are jobs AI cannot do, and there are not enough people to fill them.
Then there is the latest data. A new study from Ramp’s Economics Lab, linking corporate AI spending to workforce records across more than 21,000 companies, found that firms investing heavily in AI grew their headcount by 10.2% in the two years after adopting AI. Entry-level hiring at those firms rose even faster, by 12%. The companies betting biggest on automation were not shedding workers but adding employees to their teams.
As for the AI CEOs, "they may have noticed that the labor market is genuinely not changing (i.e., imploding) as rapidly as they expected," the MIT economist David Autor told the Wall Street Journal. "They may have realized it was simply bad business to say that your great new product will destroy the economy."
Indeed, how much of what we've been hearing from the last few years about AI is exaggerated, how much is hucksterism, and how much is honest-to-goodness projection based on fact?
Part of the problem may be how some of these futurists see the economy. They appear to be making the mistake of seeing the economy as a fixed pie, with AI taking slices away. "When a technology makes workers more productive, it makes their labor more valuable, not less, lowering costs, expanding what a firm can attempt, and creating demand for work nobody had imagined," writes Leamer.
JPMorgan Chase CEO Jamie Dimon said last week, "We don't really know" what impact AI will have on the workforce going forward.
"I think people should stop being breathless over it. You know, it's created a lot of jobs in our company, and yeah, there are areas where it's reduced jobs a little bit," Dimon said.
"Technology always creates new jobs. The question is going to be if it happens too fast, somehow, people are adopting it too fast and jobs are being lost – middle-class jobs before they could be retrained to replace," Dimon said.
Dimon says that AI has added value to his company, and says, "I think we're kind of scaring the whole world much more rapidly than we should about it."
The Washington Post reported last week on what's shaping up to be the "largest labor shortage in U.S. history":
Economists warn that the worsening labor problem, due in part to a skills shortage and population shifts, will be vast and reach beyond tech.
It “could hobble the American economy for years to come,” predicts the Georgetown University Center on Education and the Workforce. Lightcast, a labor market data company, calls it “the largest labor shortage the country has ever seen.”
JPMorgan Chase warns of a national security risk from “a pervasive talent deficit that constrains the nation’s capacity to build, compete, and protect its interests.”There will be shortages in the tens or even hundreds of thousands of nurses, physicians, teachers, engineers, pharmacists, mental health counselors, construction workers and airplane mechanics — jobs AI generally can’t do.
In a $31 trillion economy, there are going to be uneven trends, with some people in some regions unable to be matched to a job they can perform or want. But this is a far more pressing problem than AI destroying some kinds of jobs. “All of these people who keep a society functioning are the very people we’re not going to have enough of,” said Ron Hetrick, Lightcast’s principal economist.
Perhaps we should start nudging Generation Z toward training and studying for jobs that are actually going to be needed, rather than "influencer" or "content creator." A "purpose-driven" profession is fine, but how are you going to make a living and become a productive member of society?
If politicians, regulators, and CEOs restrain themselves from interfering in AI's shakeout, and concentrate on keeping us safe, the AI "jobs apocalypse" will end up being a mirage.
