Another major CEO warns that artificial intelligence could wipe out ‘literally half’ the white collar workforce
In another ominous admission from one of the world’s largest companies, it’s emerged that a huge chunk of the workforce is under threat.
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There has been an ominous, and significant, tonal shift in recent months.
The bosses of major global companies are starting “to say the quiet part out loud”, as The Wall Street Journal put it this week. They are conceding, publicly, what was previously said behind closed doors: yes, artificial intelligence is genuinely a threat to large chunks of the world’s workforce.
The latest example, and perhaps the bluntest, comes from Jim Farley, CEO of the American car manufacturer Ford.
“AI is going to replace literally half of all white collar workers,” Mr Farley told the Aspen Ideas Festival, where he was interviewed on stage by author Walter Isaacson.
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“I believe that AI and new technology have an asymmetric impact on our economy. That means a lot of things are helped a lot, and a lot of things are hurt,” said Mr Farley.
“And when you look at these openings in our economy, it is very clear that a lot of technology we’ve seen has left a lot of people behind.
“AI will leave a lot of white collar people behind. And we have to acknowledge that these new technologies are great, they’ll make a lot of people’s lives better, but what are we going to do as a society for the people that it leaves behind, who are valuable humans?
“We have to have a plan for sustainment. And we don’t have that plan today.”
Mr Isaacson drilled down on the division, in AI’s potential effects, on white collar versus blue collar workers.
“To what extent can AI increase the productivity of essential workers? Or will it just wipe out those types of workers?” he asked.
“I think it will help a lot,” said the Ford boss.
“AI will certainly help with billing and lots of menial tasks.”
“What about robotics? What about hands on tasks?” asked Mr Isaacson.
“Well, I think robotics will substitute quite a few jobs,” said Mr Farley.
“A factory job is complicated. It’s difficult. And so far, maybe 10 per cent of our operations can be roboticised. With a humanoid robot, maybe it’s 20 per cent. But it’s not going to be 80 per cent. And it will take a long time, because the cost of robotics is expensive.
“Humans are amazing. I see humans do things in our plant that a robot can’t do.”
Still, “literally half of white collar workers” is a striking warning, which cuts against a lot of the hedging we’ve heard from major CEOs amid AI’s rise.
It’s been a month since Dario Amodei, boss of the AI company Anthropic, berated business and political leaders for “sugar-coating” the possible consequences.
“We, as the producers of this technology, have a duty and an obligation to be honest about what is coming,” Mr Amodei told Axios.
“Most (people) are unaware that this is about to happen. It sounds crazy, and people just don’t believe it,” he added, predicting that despite the benefits of AI, unemployment (in the US, at least) could rise to a rate as high as 20 per cent.
“It is a strange set of dynamics where we’re saying: ‘You should be worried about where the technology we’re building is going.’
“Critics reply: ‘We don’t believe you. You are just hyping it up.’ What if (we’re) right?”
While the white collar apocalypse obviously has yet to strike on anything like that scale, the trickle of warning signs has accelerated in recent months.
“Like with every technical transformation, there will be fewer people doing some of the jobs that the technology actually starts to automate,” Amazon CEO Andy Jassy told CNBC during an interview this week, having confirmed that more job cuts at the company are likely.
Amazon has already slashed almost 30,000 from its workforce.
“We will need fewer people doing some of the jobs that are being done today,” Mr Jassy told his workers in a memo last month.
“And more people doing other types of jobs. It’s hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total workforce as we get efficiency gains from using AI extensively across the company.”
Fiverr CEO Micha Kaufman also chose a memo as his medium for issuing a warning to his company’s staff.
“It does not matter if you are a programmer, designer, product manager, data scientist, lawyer, customer support rep, salesperson or a finance person. AI is coming for you,” he said.
“This is a wake-up call.”
Back in may the CEO of JPMorgan Chase, Marianne Lake, told investors she expected the bank to shed up to 10 per cent of its staff in the coming years, to be replaced by AI.
Shopify entered the news in April, with the revelation that it would not agree to hire new workers unless managers could prove AI was incapable of doing the job in question.
“Reflexive AI usage is now a baseline expectation at Shopify,” boss Tobi Lutke wrote to staff, in a memo he also posted publicly.
He said the company would “add AI usage questions to our performance and peer review questionnaire”. But more relevant, for this discussion, was this last point.
“Before asking for more headcount and resources, teams must demonstrate why they cannot get what they want done using AI. What would this area look like if autonomous AI agents were already part of the team,” he said.
This week Microsoft signalled its intention to cut 9000 jobs, 4 per cent of its global workforce, while investing tens of billions more dollars in AI.
These examples keep popping up, with increasing frequency, and in multiple sectors.
The public sector is not immune, of course. The Australian government, for its part, has a “policy for the responsible use of AI” in the public service, which it has been implementing since last year.
“We’ve agreed across all levels of government that the rights, wellbeing, and interests of people should be put first whenever a jurisdiction considers using AI in policy and service delivery,” Finance Minister Katy Gallagher said when it was announced.
“Trust in the community is crucial if we are going to be able to successfully integrate AI into the existing suite of services that governments of all levels provide.”
Originally published as Another major CEO warns that artificial intelligence could wipe out ‘literally half’ the white collar workforce
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