Goldman Sachs predicts 300 million jobs will be lost or degraded by AI

UNITED STATES: If generative AI lives up to its hype, the workforce in the United States and Europe will be upended, Goldman Sachs reported this week in a sobering and alarming report about AI’s ascendance. The investment bank estimates 300 million jobs could be lost or diminished by this fast-growing technology.

Goldman contends automation creates innovation, which leads to new types of jobs. For companies, there will be cost savings thanks to AI. They can deploy their resources toward building and growing businesses, ultimately increasing annual global GDP by 7%.

In recent months, the world has witnessed the ascendency of OpenAI software ChatGPT and DALL-E. ChatGPT surpassed one million users in its first five days of launching, the fastest that any company has ever reached this benchmark.

Goldman predicts that the growth in AI will mirror the trajectory of past computer and tech products.

Just as the world went from giant mainframe computers to modern-day technology, there will be a similar fast-paced growth of AI reshaping the world.

AI can pass the attorney bar exam, score brilliantly on the SATs and produce unique artwork.

While the startup ecosystem has stalled due to adverse economic changes, investments in global AI projects have boomed. From 2021 to now, investments in AI totaled nearly $94 billion, according to Stanford’s AI Index Report. If AI continues this growth trajectory, it could add 1% to the US GDP by 2030. Office administrative support, legal, architecture and engineering, business and financial operations, management, sales, healthcare and art and design are some sectors that will be impacted by automation.

The combination of significant labour cost savings, new job creation, and a productivity boost for non-displaced workers raises the possibility of a labor productivity boom, like those that followed the emergence of earlier general-purpose technologies like the electric motor and personal computer.

According to an academic research study, automation technology has been the primary driver of U.S. income inequality over the past 40 years.

The report, published by the National Bureau of Economic Research, claims that 50% to 70% of changes in US wages since 1980 can be attributed to wage declines among blue-collar workers replaced or degraded by automation.

Artificial intelligence, robotics and new sophisticated technologies have caused a vast chasm in wealth and income inequality. It looks like this issue will accelerate.

For now, college-educated, white-collar professionals have largely been spared the same fate as non-college-educated workers. People with a postgraduate degree saw their salaries rise, while “low-education workers declined significantly.

“The study states, “The real earnings of men without a high-school degree are now 15% lower than they were in 1980.”