AI: The New Disruptor in the Workforce
Generative artificial intelligence (AI) is shaking up a wide range of professions, from the arts to national security and education. Some futurists predict that AI could render most jobs obsolete, suggesting that these clever machines could take over tasks that have traditionally been the sole domain of human beings. Whether this potential shift is seen as a utopian dream or a dystopian nightmare largely depends on the narrative one chooses to embrace.
Class Struggle or Abundance?
On one side of the debate, critics warn that AI-driven job losses could incite class warfare, widening the gap between the wealthy and the impoverished. Others argue that if AI successfully eliminates the need for work, we might also see the end of scarcity, rendering money obsolete. A more alarmist faction believes that AI will ultimately lead to human extinction, making such discussions moot. Meanwhile, some economists, like Henry Thompson from Ole Miss, contend that AI will adhere to economic principles, suggesting we may never reach that point (for a deeper dive, see his working paper “Some Economics of Artificial Super Intelligence”). While the implications of AI on the future of work are undoubtedly intriguing, my focus here will be on how AI is poised to reshape current jobs and labor markets.
A Historical Perspective
Concerns about machines encroaching on human labor are hardly a modern phenomenon. Echoes of today’s fears can be traced back to the Luddite movement of 19th-century Britain, where skilled weavers protested against the introduction of mechanized weaving. Their worry was that automation would lead to low-quality products and the loss of their livelihoods. Despite their sabotage efforts, they ultimately lost the battle, and the textile industry transitioned to a highly automated model.
Keynes and the Promise of Leisure
Leaping forward to the 20th century, economist John Maynard Keynes made a similarly optimistic prediction: in his 1930 essay “The Economic Possibilities for Our Grandchildren,” he posited that automation would enable us to work just three hours per day.
Reality Check
As it turns out, both predictions missed the mark. Yes, some weavers lost their jobs, but the industry didn’t devolve into mediocrity. Instead, wages for skilled textile workers actually improved. In 1800, the typical textile worker earned about 25 shillings a week (equivalent to approximately £4,767 today). Today, the average skilled textile worker makes around £29,000 annually.
Why the rise in wages? The answer lies in the transformation of work itself. Those who could only replicate what machines did found themselves out of work, while those who adapted to integrate machines into their processes saw their productivity—and therefore their wages—rise. A recent study published in the Journal of Labor Economics confirms that these trends persist even in our modern landscape of automation.
As for Keynes’s vision? According to the Bureau of Labor Statistics, the average American worked about 42 hours a week in 2024 (for full-time jobs), a slight reduction from the roughly 47 hours in Keynes’s time, but still a far cry from his dream of a 15-hour workweek.
Understanding the Motivation Behind Work
In a recent paper published in Industrial and Organizational Psychology, my colleague Dr. Anne-Marie Castille and I explored the reasons behind the inaccuracies in these predictions. We argue that both the Luddites and Keynes overlooked a crucial point: automation does not eliminate our fundamental reasons for working, particularly the scarcity of resources, including time.
Initially, people allocate their time to high-value tasks. When automation reduces the time needed for these activities, it tends to free up time for less critical pursuits. This can lead to the exploration of new interests or desires. For example:
“Domestic chores once consumed a significant amount of time, such as washing clothes by hand and hanging them on a line. With the advent of washing machines, the time needed for laundry plummeted to about 20 minutes per load. This newfound efficiency allowed domestic workers (predominantly women) to reclaim their time, leading many to enter the workforce or engage in leisure activities.”
“…As people’s wealth increased, their fundamental needs for food, shelter, and companionship were met with fewer resources. This shift resulted in a trade-off: should we use our spare time for leisure or work to fulfill other emerging desires?”
The Future: A Cycle of Adaptation
I contend that we are likely to see a similar pattern with the rise of generative AI. Yes, some jobs may be displaced, but new roles will undoubtedly emerge as human creativity and necessity evolve. What these new jobs will look like remains uncertain, but history shows us that human innovation can lead to unexpected opportunities. AI will not resolve the underlying motivation for work: the ever-present issue of scarcity.
