Forget artificial intelligence breaking free from human control and taking over the world. A much more pressing concern is how today’s generative AI tools will transform the labor market. Some experts predict a world of increased productivity and job satisfaction; others, a landscape of Mass unemployment and social unrest.
Someone who has an overview of the situation is Maria Daly, CEO of the Federal Reserve Bank of San Francisco, part of the national system responsible for setting monetary policy, maintaining a stable financial system, and ensuring maximum employment. Daly, a labor market economist by training, is especially interested in how generative AI could change the labor market landscape.
Daly spoke with WIRED Senior Editor Will Knight over Zoom. The conversation has been edited for length and clarity.
He has been speaking to early adopter companies about the use of generative AI. What are you seeing? Or, to ask the question on many people’s minds, are workers being replaced?
More companies than I would have imagined are already looking at it. Some will have more opportunities to replace workers and others more to increase, but in general what I see is that no company is using it only as a replacement tool.
One person I spoke to, their company, invested in generative AI and used it to help write descriptions of the items they have for sale. They have hundreds of thousands of articles, but not all of them are high margin or interesting to write about. And then they can continue to add more writing staff or they could use generative AI to write the first drafts of these elements. Editors become auditors and do more interesting work.
How confident are you that generative AI won’t eliminate jobs overall?
Technology has never reduced net employment over time for the country. If we look at technology over several centuries, what we see is that the impact lands somewhere in between, not necessarily the middle point, but somewhere there, and where we end up depends largely on how we relate to technology. technology. technology.
When I think about generative AI (or AI more broadly), what I see is an opportunity. You can replace people, you can augment them, and you can create new opportunities for people. But there are winners and losers. I came of age as an economist in the age of computerization. That computing boom and the productivity that came with it clearly produced inequalities.
AI in general, but especially generative AI, is an opportunity to help people with average skills be more productive. But that is our choice and it requires a lot of thought on our part.
Therefore, white-collar workers could, in theory, have superpowers thanks to AI. How can we ensure that companies implement technology in that way?
Before we get to obligateI think we could start with educate, and a tight labor market really helps us. In a market where it is harder to find people with a computer science degree, companies are basically driven by their own motive to be profitable and productive. They ask, “How can I most effectively use less expensive talent?” I think corporate thinking naturally tends to replace workers, because it’s easier to think that way, but this is not set in stone.
Companies that develop and sell AI models and tools don’t seem to think that way. They seem to focus exclusively on how AI can replace humans.