Major Tech Companies Expand AI's Role in Operations
6-7% of U.S. Jobs Could Be Automated Away Within a Decade
The U.S. labor market has begun to gradually reflect the impact of generative artificial intelligence (AI) adoption, with young tech workers in their 20s and 30s being hit the hardest, Goldman Sachs has warned.
According to CNBC on August 5 (local time), Joseph Briggs, chief global economist at Goldman Sachs, stated in a recent podcast that although many companies have yet to fully integrate AI into their operations, signs of reduced hiring in the technology sector are already emerging. He specifically pointed out that young employees are bearing the brunt of these changes.
Briggs argued that employment in the U.S. technology sector, which had steadily increased over the past 20 years, has slowed since the end of 2022. In fact, since the beginning of this year, the unemployment rate among tech workers aged 20 to 30 has risen by about 3 percentage points, a much larger increase compared to other industries.
Briggs explained, "If you look at employment trends in the tech sector, the share of tech jobs in overall employment has increased almost linearly over the past 20 years. However, in the past three years, hiring in the technology field has retreated, dropping below the previous trend."
The spread of generative AI is seen as the trigger for this change. Advanced AI tools such as OpenAI's ChatGPT have developed to the point where they can match or even surpass the productivity of software engineers.
Major tech companies are also expanding the role of AI in their operations. Alphabet (Google's parent company) and Microsoft have reported that AI writes more than 30% of the code in some projects, while Salesforce has said that up to 50% of internal tasks are performed by AI.
George Lee, co-head of the Goldman Sachs Global Institute, noted that before tech company CEOs fully adopt AI, they have mainly delayed new hiring. He expressed concern that "while companies are considering how to become more flexible and agile without undermining their competitiveness, young employees will be the ones to suffer for the time being."
Goldman Sachs, even in its conservative outlook, predicted that AI automation could result in 6-7% of U.S. workers losing their jobs over the next decade. Briggs warned, "If AI adoption proceeds faster than expected, the combination of technological advancement and cost-cutting pressures could lead to an even greater decline in employment."
Goldman Sachs further analyzed that if AI evolves into artificial general intelligence (AGI) capable of performing a wide range of tasks, the phenomenon of AI-driven job replacement could accelerate across the entire labor market.
Briggs projected, "If AI research reaches AGI, that is, human-level intelligence capable of learning and adapting across multiple domains, the shock to the labor market will be far more severe."
He added, "This analysis does not take into account the possibility of AGI emerging. It is difficult even to imagine the impact on the labor market, but there is certainly the potential for greater labor displacement and disruptive shocks."
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