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Feb 07, 2017

AI and Automation Versus Jobs

Written by Anthony Demangone

I've written about "Black Swans" in the past. 

According to the best-selling book by Nassim Nicholas Taleb, a Black Swan event has three characteristics.

  1. It is an event that greatly changes society. And few expected it or were ready for it at the time.
  2. It is something that has been at the edges for a decade or more.
  3. When it takes effect, people look back at the change and think to themselves..."We should have seen that coming." 

Examples? 9/11. The "Great Recession." The rise of the automobile. 

What is the next one? It is hard to say. But I've been reading more and more about artificial intelligence and automation, and how it could affect jobs. 

This article, for example, predicts that nearly half of current jobs could be lost in the next 25 years. Here's a snippet:

But instead of a pro-job growth future, economists across the board predict further losses as AI, robotics, and other technologies continue to be ushered in. What is up for debate is how quickly this is likely to occur.

Now, an expert at the Wharton School of Business at the University of Pennsylvania is ringing the alarm bells. According to Art Bilger, venture capitalist and board member at the business school, all the developed nations on earth will see job loss rates of up to 47% within the next 25 years, according to a recent Oxford study. “No government is prepared,”The Economist reports. These include blue and white collar jobs. So far, the loss has been restricted to the blue collar variety, particularly in manufacturing.

Now, is this alarm bell a bit over-dramatic? Again, it is hard to say.

But let's say it is only partly right? 

  • What effect would a higher level of systemic unemployment have on lending?
  • Savings accounts?
  • Staffing? 
  • Delinquencies?

I used to think 25 years in the future was a long way off. I'm not so sure anymore!

***

Let me know if you're headed to our Strategic Growth conference later this month in Charleston, S.C. I'd love to see you and catch up. 

And as always, many thanks to the following companies for making this year's conference possible.  

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