Goldman Sach's Chief Economist, Jan Hatzius, says artificial intelligence (AI) could reportedly kill jobs in some areas but maintains that it would also boost job opportunities in other areas.
Speaking to CNN, the chief economist stated he sees AI as a productivity booster when asked last week by CNN's Matt Egan if he thought it would create jobs or eliminate existing ones.
He believes that because certain jobs in the labor market will be somewhat replaceable, it will destroy jobs in some places.
(Photo: Michael M. Santiago/Getty Images) NEW YORK, NEW YORK—SEPTEMBER 13: The Goldman Sachs logo is seen at the New York Stock Exchange on September 13, 2022, in New York City.
He clarified, however, that people will also find other ways of innovating and creating more jobs elsewhere. He compares the AI economy to the story of economic growth and innovation that has happened for hundreds of years, wherein people have an innovation that is labor-saving, thus reducing employment in some areas but then boosting it in others.
Although Hatzius concedes that identifying the immediate effects of AI will be challenging, he is far more optimistic about the technology's long-term contribution to growth, as it will essentially accelerate productivity growth. Long-term impact: The economist predicts AI's biggest impact will not be felt for another five years, roughly around the early 2030s.
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Goldman Sachs' AI Prediction
The chief economist's views on AI are consistent with a study conducted by Goldman Sachs last year, which concluded that if generative AI lives up to its hype, the US and European labor markets will undergo significant disruptions. The investment bank estimates that 300 million jobs could be lost or reduced as a result of this rapidly advancing technology.
According to Goldman, the development of AI will follow the same path as that of earlier tech and computer goods. The world will change due to artificial intelligence replacing large mainframe computers at a rate comparable to that of modern technology. It will grow at an exponential rate. AI can pass the legal bar exam, achieve remarkable SAT scores, and create imaginative artwork.
AI Worsens Economic Inequality
On the other hand, the International Monetary Fund (IMF) predicts that AI will aggravate economic inequality worldwide and reduce the need for work. Depending on the country's economic conditions, AI will impact over 40% of jobs, both benefiting and harming people.
Because industrialized economies are more accustomed to AI's benefits and drawbacks than emerging markets and developing nations, it is anticipated that AI will worsen global inequality.
The study says artificial intelligence may impact 60% of jobs in industrialized countries. By incorporating AI, the output of almost half of the exposed occupations could rise.
On the other side, if AI systems replace humans in crucial tasks, half of the workforce would witness a decline in labor demand, which would mean lower wages and fewer positions being filled. In the worst-case scenario, a few of these roles might disappear.
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