AI taking white-collar jobs. Economists warn ‘much more in the tank’

JPMorgan Chase And Goldman Sachs They use it to employ fewer people. ford CEO Jim Farley warned that it would “replace literally half of white-collar workers.” sales force‘s Marc Benioff claimed that he’s already doing up to 50% of the company’s workload. Walmart CEO Doug McMillon told Wall StreetJournal “It will literally change every business.”

The “it” on corporate America’s lips is artificial intelligence.

Less than three years into the productive AI boom, executives in every major industry are loudly telling employees and shareholders that the size and shape of the workforce is about to change dramatically (if it hasn’t already) due to the ongoing technological revolution.

What started with the launch of OpenAI’s ChatGPT and a new way for consumers to use chatbots has quickly spread to businesses, with companies using specialized AI agents to automate functions in customer support, marketing, coding, content creation, and other areas.

Goldman Sachs’ latest estimates show that: 6% to 7% 90% of US workers could lose their jobs due to AI adoption. Using ADP employment data, the Stanford Digital Economy Lab found that entry-level hiring in “AI-exposed jobs” has fallen 13% since big language models began to proliferate. The report stated that software development, customer service and clerical jobs are the types of jobs most vulnerable to artificial intelligence today.

“We are at the beginning of a decades-long development of progress that will have a major impact on the labor market,” he said. Gad LevanonHe is the chief economist of the Burning Glass Institute, a research firm focused on changes in the economy and workforce.

Automation is nothing new, of course. In every era, there is the printing press, ATM machine, automatic teller machine, or online booking agency that replaces human labor with some form of technology. In the process, new jobs emerge and economies adapt and evolve.

A. report The onslaught of artificial intelligence, robotics and automation could displace 92 million jobs and add 170 million new roles by 2030, according to a forecast from the World Economic Forum earlier this year. Artificial intelligence development, research, security and application are growth areas alongside robotics.

Erik Brynjolfsson, director of the Stanford research group, said that in addition to new types of roles, physical jobs such as healthcare aides and construction workers have so far been protected from AI disruption.

“There will be more turbulence in both directions in the coming months and years,” Brynjolfsson said in an interview. “We need to prepare our workforce.”

High-level data does not show major changes yet.

The US government has been shutting down for three weeks, so the Bureau of Labor Statistics has been plunged into darkness. But alternative reports from organizations such as the Chicago Fed show that the economy is sluggish. Employment growth is moderate but the labor market remains stable.

The unemployment rate remained steady at 4.3% in September, while layoffs and other layoffs remained at 2.1%, according to the Chicago Fed.

recently study published Research by the Budget Lab at Yale found no “noticeable disruption” caused by ChatGPT. The lab’s co-founder, Martha Gimbel, described the upheaval from AI as “minimal” and “incredibly concentrated,” but that could change as technological changes spread to the broader economy.

“The rest of the economy generally moves slower than Silicon Valley,” he said.

New York Fed found questionnaire Last month, only 1% of service companies reported laying off workers because of AI in the past six months. The Human Resources Management Association said: data It shows that 6% of jobs in the US are 50% or more automated; This rate rises to 32% in computer and mathematics-related professions.

It doesn’t take much curiosity to get company executives talking about the future.

Amazon CEO Andy Jassy said in June that his company’s corporate workforce would be reduced by AI over the next few years, and he encouraged employees to learn how to use AI tools to eventually “accomplish more with more complex teams.”

The New York Times published a investigation piece It showed on Tuesday that Amazon’s automation team expects to avoid hiring more than 160,000 people in the U.S. by 2027, equating to a savings of about 30 cents on every item Amazon packages and delivers. The Times said the report was based on interviews and internal strategy documents.

palantir The data analytics company, which has increased its market value more than elevenfold in the past two years, aims to increase its revenue by 10 times and reduce its headcount by about 12%, CEO Alex Karp told CNBC in August. He did not specify a time frame for achieving this goal.

The message is spreading throughout the tech industry.

Benioff, Salesforce’s CEO, said last month that the software company was reducing the number of customer support roles from 9,000 to 5,000 “because I need fewer heads.” Swedish fintech company Klarna He said he reduced his workforce by 40% by adopting artificial intelligence. Shopify CEO Tobi Lutke told employees in April that they would be expected to prove why they “can’t do what they want using AI” before asking for more headcount and resources.

Coding assistants were among the early winners of the generative AI craze, and were the first real type of app to attract large numbers of paying users. Information It was reported last week that Cursor’s parent company, Anysphere, was in talks to raise funds at a valuation of $27 billion. Microsoft’s Other startups including GitHub and Replit in an increasingly crowded market.

Software development is just the beginning.

In banking, CFO Jeremy Barnum told analysts last week that JPMorgan’s executives have been told to avoid hiring humans as the company uses AI in its business. Goldman Sachs CEO David Solomon said his bank’s acquisition of artificial intelligence will “undertake how we organize our employees, how we make decisions, and how we think about productivity and efficiency.”

There is also the automotive industry.

Ford CEO Farley He told Walter Isaacson “AI will leave many white-collar people behind,” he said in a July interview, reflecting a growing sentiment in his industry. According to a marketing solutions firm’s survey of 500 U.S. auto dealers. FironHalf of those surveyed said they expect AI to drive autonomous vehicles by 2027.

“This means AI creates marketing assets, manages listings, answers buyer questions, closes deals, arranges financing, and closes the sale—all without human input,” Phyron wrote in its report on survey results last month. he said.

The topic will likely receive a lot of attention over the next few weeks as the world’s largest tech companies release quarterly results and inform investors about their AI deployments. Tesla’s It kicks off tech earnings season on Wednesday, followed by next week Alphabet, Metamicrosoft, Apple and Amazon.

WRISTWATCH: Artificial intelligence will not replace employees, but will perform the tasks performed by employees