PRODUCTIVITY AND EMPLOYMENT?
Namaste Yogis. Welcome to the Blockchain & AI Forum, where your blockchain and artificial intelligence technology questions are answered. Here no question is mundane. As a bonus, a proverb is also included. Today’s question, was submitted by Milagros and she wants to know what will be the impact of artificial intelligence on productivity and employment?
Milagros, you came to the right place. Two days ago, I viewed an interview with Philippe Aghion. Aghion is a leading French economist who recently published an important research paper on the subject that he presented to French President Emanuel Macron. Holy influencer, Batman! Although there are numerous AI experts, this article covers only the perspective of Aghion.
Aghion limited his research to the impact of AI on productivity and employment. According to Aghion, the full impact productivity and employment of AI will go beyond electricity and the internet! Holy big assertion, Batman. Let’s understand Aghion’s logic.
His first reason is perhaps obvious; AI facilitates automation, and automation means increased productivity. Easy to agree; let’s move to his second reason. Aghion says, AI facilitates learning, and again, intuitively he makes sense. Just like electricity and the internet facilitated learning, in too many ways to itemize here, AI users can learn new skills and information, making them more productive and thus increasing overall productivity. Aghion’s third point is where he inaugurates new thinking.
Aghion says, AI is vastly superior to either electricity or the internet in its ability to produce new ideas and these forthcoming innovations will deliver greater productivity and employment. And, unlike electricity and the internet which both eventually plateaued in productively gains, Aghion says the boost in productivity coming from new ideas will continue for an undetermined duration because there is no limit to human ideas. Last, Aghion says electricity and the internet both took about 10 years before impacting productivity meaningfully; AI is on the same trajectory. Time to examine what Aghion says concerning employment—it’s not all rosy.
Let’s start with the good news. Aghion claims that automation creates more net employment. He says automation adopters become more efficient and pass along the benefits to customers in lower prices and better quality. He further claims, that although competitors may lose jobs, the overall market size grows because new customers enter and employment in the sector grows. Analogous to what Henry Ford did in the automobile industry.
As expected, Aghion believes certain industries might be in jeopardy and offered three examples: IT security firms, production process companies, and machine learning firms (e.g., call centers). With regards to employment impacts, he divided his analysis into significant, moderate, and little to no effect. Aghion identified clerks, secretaries, and accountants as the three most likely adversely impacted occupations. Aghion says architects, lawyers, and perhaps health care fall in the moderate group.
Aghion concluded with a few recommendations starting with government policy to prevent oligopolies from dominating AI. He notes large firms are not necessarily innovators, but small firms are. Second, open-sourced AI is essential to transparency and long-term viability. Third, protection of personal data must be a priority. Last, is job training and re-education for displaced workers. Aghion forecasts 20% of all jobs will be eliminated or nearly eliminated by AI over the next decade. Therefore, generous re-education, training, and unemployment benefits will be required.
Time to quit before AI grabs my money losing blog, (ha ha) and share a French proverb:
“You should turn your tongue around in your mouth seven times before you speak.”
Until next time,
Yogi Nelson
Blockchain & AI Forum 