Along with the excitement surrounding artificial intelligence (AI) is growing concern that AI could have a potentially catastrophic effect on employment. However, new research suggests that these fears may be overblown. As the government seeks to develop new AI regulations these findings should temper efforts to pass reactionary rules that could unintentionally deprive consumers of important benefits.
As often accompanies advances in technology, AI’s rise has sparked concern regarding job loss and worker displacement. For example, the International Monetary Fund (IMF) predicted that 60 percent of all jobs in developed countries, like the United States, are likely to be impacted by AI in some way. In addition, the IMF argues that while about half of these jobs will be enhanced by AI, the other half could be negatively impacted, with some becoming obsolete altogether. The IMF believes that these changes are likely to be felt across large swaths of the economy, even impacting white-collar jobs that are usually insulated from market upheavals due to changing technology.
However, as more data becomes available, research is painting a much less dire picture. MIT’s recent study found that for the many jobs, the technology is still too costly for businesses to implement AI. In other words, it is still more efficient to use human labor. As a result, the mass displacement of workers that critics have long feared has not materialized. AI is simply not yet affordable enough to employ on a large scale and it could take years to get to that point. This means the economy will have an easier time absorbing the job losses and disruption caused by AI.
While the MIT study has limitations, since it only looks at AI that analyzes visual data and not generative AI like ChatGPT, it does cast doubt on many of the doomsday scenarios about mass unemployment.
If lawmakers create expansive new regulations based on the mere potential for job losses, they will be attempting to solve a problem that may never arise. In turn, America could miss out on many important consumer benefits, including efficiency gains from job augmentation and novel consumer applications. Regulating based on fear is a losing strategy.
Trey Price is a policy analyst with the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit us at www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.