AI and Employment: A Relic of the Past or a New Paradigm?

Recently article According to a report by the World Economic Forum (WEF), two economists from the Boston Consulting Group argue that the impact of AI on jobs will be similar to past technological revolutions. In other words, there may be significant impacts on certain individuals who may be replaced by AI, but overall, they believe that more jobs will be created than will be lost.

This may indeed be the case, but it is also a myth, and certainly wrong. The reason is that the impact of AI on jobs could be far more disruptive than previous technological revolutions. Because AI can be used to outsource cognitive tasks, it is likely to result in more significant and widespread job displacement than previous innovations.

The view expressed by WEF economists is that AI will follow past episodes of technological change, such as when the internal combustion engine and automobile replaced the work of horses, or when technology was widely applied in agriculture. A few years ago, Microsoft President Brad Smith Written with a pen A great blog explaining the transition from horses to cars and the far-reaching impact on jobs. Few things evolved during this transition that we would have expected, including the positive job creation flywheel in related industries such as car and parts manufacturing, road building, or advertising.

According to According to the McKinsey Global Institute, the auto industry created a net 6.9 million new jobs in the United States between 1910 and 1950, or 11 percent of the U.S. workforce in 1950. That includes 7.5 million jobs created and 623,000 jobs destroyed. Smith points out that more than technology contributed to this rapid change, it was also evolving cultural values. Progressive moment Advocated improvements in urban efficiency, sanitation, and safety.

In other words, it was more than just technological progress that drove these dynamic employment outcomes. Therefore, past technological changes involving a unique mix of attributes do not predict a different and different future.

When it comes to AI, the past can’t predict the future.

Today, it is not the progressives of the early 20th century, but the technological accelerationists who are pushing AI change at a rapid pace. Those who share this view support rapid technological progress. Of course, there are opponents who demand AI to be safe and use responsibly. Nevertheless, the absence of meaningful regulation that can substantially limit the development of AI and its impact (at least in the United States) means that we are accelerating toward an uncertain future.

It is not a given that AI’s impact on jobs will mirror previous technological revolutions, but there are important differences. AI is the first to outsource cognition in addition to labor. This difference introduces a layer of complexity that has never been seen before. In the past, it was primarily physical disruption, such as replacing human labor with horsepower and horsepower with machine power.

Outsourcing brainpower means that AI can increasingly handle tasks that require problem solving, decision making, and creativity—tasks once considered exclusively human. While history offers valuable lessons, the unique nature of AI presents unprecedented and unpredictable challenges.

Is it augmenting or replacing work?

These challenges have already become apparent in many areas. Recently inspection He said “Seventy-four percent of IT professionals expressed concern that AI tools will ‘make many of their everyday skills obsolete.’ Additionally, 69 percent of IT professionals believe they are at risk of being replaced by AI.”

While there is a prevailing belief that AI is a useful tool to augment people, not replace them, this may be a reflection of the limitations of current technology rather than a prescription for the future. The same survey found that 35% of executives plan to invest in AI tools and technologies to “eliminate redundant positions.”

These concerns are consistent with the following findings: Richmond Federal Reserve BankThey recently published a report citing companies’ plans to use AI and automation to reduce their workforce, finding that “45% of companies said they had introduced automation in the past year as part of a path to reducing their workforce.” [and] A very similar 46% of companies said they plan to do the same thing “over the next two years.”

In contrast, a separate report found that The Dalles Federal Reserve Bank So far, they report that the impact of AI on employment has been minimal. They quoted one financial services respondent as typical: “AI helps ease the burden of work and increases productivity, but we are not at the point where AI replaces workers.”

This statement highlights AI’s current role as a tool to augment rather than replace workers.

The playing field is changing

Changes in employment are happening, even if they are not yet reflected in numbers. For example, the often cited study Ten percent of call center workers showed that AI-augmented new hires could perform as well as experienced workers, according to MIT Technology Review Reported One study found that software engineers can code twice as fast with the help of AI.

AI itself may not change the total number of call center workers or software engineers, but it could significantly change the composition of the workforce. The implications of this type of change could be enormous. For example, it could allow new employees to compete more effectively with experienced professionals, potentially democratizing access to these jobs and increasing productivity.

As these changes occur, the premium on experience in the field will diminish, potentially leading to lower wages, rapid turnover, underemployment, the need for retraining, and a wider skills gap or income inequality between those who can and cannot adapt to AI-enhanced roles.

This dynamic will not be limited to any one profession or industry. The financial services industry, for example, could see similar impacts. ReportedCitigroup says AI will upend consumer finance and make workers more productive. They conclude that 54% of all jobs across banks are likely to be automated, and 12% of all roles across the industry could be augmented by AI technology.

There are already cases where entire call center departments are being replaced by AI chatbots. For example, Swedish fintech company Klarna has implemented an AI assistant that currently handles the following workloads: 700 full-time employeesIndia-based e-commerce platform Dukaan has laid off 27 customer service employees. Replaced them Using bots.

Where are the new jobs?

As AI disrupts existing roles, it also creates new types of employment opportunities. For example, Citigroup says financial firms will need to hire AI managers and AI-focused compliance officers in the future to ensure that the technology’s use complies with regulations. New positions are sure to be created across industries, from AI risk managers who assess and mitigate potential risks associated with implementing AI in a business context, to AI-human interface designers who create intuitive and effective ways for humans to interact with AI systems.

My personal favorite new role could be the “AI orchestrator.” A critical human expert in understanding context, making ethical choices, and building stakeholder relationships that machines cannot fully understand. As an orchestrator, they guide a variety of AI tools, whether text generators, image generators, or video tools, integrating their outputs for the highest quality work product. Each tool acts as part of an ensemble, and it is the human orchestrator who ensures that the symphony is harmonious and has a positive impact.

As AI rapidly advances, the implications for employment will be complex and multifaceted. While historical analogies provide some guidance, the unique nature of AI—particularly its ability to outsource cognitive tasks—suggests that we are entering uncharted territory. The future of work is likely to be a mix of augmentation and substitution, with new roles emerging unevenly alongside the automation of existing jobs. The net impact on jobs from these changes is yet to be determined. But in a time of unprecedented change, using the past as a predictor of the future is merely looking in the rearview mirror.

Gary Grossman is EVP of Technology Practices. Edelman.