the AI Frenzy Impact Job Markets
Artificial intelligence has become ubiquitous, and it’s sparked a frenzy of activity as companies clamor to hire top talent in the field. Data scientists and machine learning specialists are in hot demand, with salaries approaching seven figures becoming the norm. But the AI frenzy has also sparked debates and concerns, particularly regarding how firms treat employees in their AI teams.
This year, more than ever, investors have been staking their fortunes on AI startups. Investors flocked to generative AI (AI that generates its own code) startups in particular, sending shares of these companies skyrocketing. In the past year, global generative AI company valuations have ballooned by more than a third, according to PitchBook. And the frenzy hasn’t stopped there: AI startup funding has soared to new highs, and a slew of “wrappers”—companies that build user interfaces for existing AI products—have launched with steep valuations.
While it’s easy to see why investors are drawn to generative AI Frenzy, the question remains whether these stocks can sustain their recent gains. One key concern is the emergence of AI-enhanced technologies that will replace existing jobs. This narrative is fueled by viral videos that show sleek robots handling mundane tasks, including driving cars in McDonald’s drive-thrus and working behind the counter at Taco Bell. It’s also bolstered by a recent study that predicts AI will cause the loss of 12 million US jobs over the next decade, as well as Goldman Sachs’ own 2020 estimate that 85 million workers will need to change their careers by 2025.
How Does the AI Frenzy Impact Job Markets?
But while it’s tempting to ring the alarm bell about AI, the fact is that there are plenty of ways for existing employees to embrace the technology and adapt. For example, there are AI tools that help job seekers find employment, and AI can enhance productivity in many workplaces. Plus, the growth of AI will create new roles and positions that didn’t exist before.
In the meantime, there is an increasing number of AI-driven layoffs at companies that are looking to make their business model more reliant on the tech. In the last few months, used-car marketplace Vroom has reportedly laid off 800 of its employees, and language learning app Duolingo will cut 10% of its contractors as it shifts to an AI-driven content platform.
But despite the potential for job losses, it’s important to remember that AI can also lead to more new jobs. This is because the development of AI systems typically requires specialized engineers, data scientists and other professionals to create and test prototypes.
Additionally, many of the tasks that will be automated by AI in the near future require less-specialized workers to operate and maintain the systems, so these jobs won’t be replaced as quickly. In the long run, AI will likely bring in more jobs than it takes away—especially if it leads to more specialized and lucrative positions. In the meantime, the rise of AI is changing job markets for the better, and giving workers the opportunity to learn new skills.