GenAI and the job market: a case for optimism

I resisted the temptation to have a GenAI summarize the 𝐄𝐜𝐨𝐧𝐨𝐦𝐢𝐜 𝐈𝐦𝐩𝐚𝐜𝐭 𝐨𝐟 𝐆𝐞𝐧𝐞𝐫𝐚𝐭𝐢𝐯𝐞 𝐀𝐈 report by Andrew McAfee (MIT). At around 20 pages long (excluding references), the report delivers on the title’s promise in less than one hour of reading. It explains how 𝐆𝐞𝐧𝐀𝐈 𝐢𝐬 𝐚 𝐠𝐞𝐧𝐞𝐫𝐚𝐥-𝐩𝐮𝐫𝐩𝐨𝐬𝐞 𝐭𝐞𝐜𝐡𝐧𝐨𝐥𝐨𝐠𝐲 that is rapidly improving, becoming pervasive, and spurring complementary innovations.

To some readers, the report may not deliver many new insights, but it does neatly structure many facts and arguments. For example, I enjoyed finding multiple sources of optimism regarding GenAI’s impact on the labor market (granted, Mr. McAfee wrote this report in his capacity as a fellow at Google, but he doesn’t shy away from describing potential harm as well).

Here are some of the 𝐩𝐨𝐬𝐢𝐭𝐢𝐯𝐞𝐬 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐥𝐚𝐛𝐨𝐫 𝐦𝐚𝐫𝐤𝐞𝐭 that offer some respite from gloomy unemployment scenarios:

• We increasingly suffer from a 𝐥𝐚𝐛𝐨𝐫 𝐬𝐡𝐨𝐫𝐭𝐚𝐠𝐞, which can be expected to grow as baby boomers retire. Raising productivity by means of GenAI will offer some respite.
• As with all general-purpose technology, GenAI can create 𝐧𝐞𝐰 𝐣𝐨𝐛𝐬. This is not just limited to prompt engineers. Economic growth and complementary innovations drive this job creation.
• This time, 𝐡𝐢𝐠𝐡𝐞𝐫-𝐩𝐚𝐲𝐢𝐧𝐠 𝐣𝐨𝐛𝐬 𝐚𝐫𝐞 𝐦𝐨𝐫𝐞 𝐚𝐭 𝐫𝐢𝐬𝐤 of being replaced. People in these jobs generally have more resources to reskill and adapt.
• GenAI grants people without a college education, as well as less experienced people at the start of their careers, 𝐞𝐚𝐬𝐢𝐞𝐫 𝐚𝐜𝐜𝐞𝐬𝐬 𝐭𝐨 𝐤𝐧𝐨𝐰𝐥𝐞𝐝𝐠𝐞 and enables them to 𝐚𝐜𝐪𝐮𝐢𝐫𝐞 𝐧𝐞𝐰 𝐬𝐤𝐢𝐥𝐥𝐬 𝐟𝐚𝐬𝐭𝐞𝐫. Together with the previous argument, 𝐢𝐧𝐜𝐨𝐦𝐞 𝐢𝐧𝐞𝐪𝐮𝐚𝐥𝐢𝐭𝐲 𝐜𝐨𝐮𝐥𝐝 𝐧𝐚𝐫𝐫𝐨𝐰, which seems to be already happening (of course, more factors are at play here).

These are a few of the arguments that, in my view, warrant cautious optimism. Nevertheless, disruption will happen. Individuals will have to reskill, businesses will have to ways to adopt and integrate GenAI, and society at large will have to work hard to smooth the transition.