Global AI Supercycle Raises Productivity Questions

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This is Bloomberg Businessweek Daily, reporting from the magazine that helps global leaders stay ahead. With insight on the people, companies, and trends shaping today's complex economy. Plus, global business, finance, and tech news as it happens. The Bloomberg Businessweek Daily Podcast with Carol Massar and Tim Stenovec.

Jess Minton (0:32)

I'm Jess Minton with Alexis Christophoros, in for Carol Massar and Tim Stenovec, who will be back tomorrow at the Future Proof Conference in Huntington Beach, California. Alexis, we've been talking so much about AI. I mean, we do pretty much every day. But just looking at today, the basket of Mag-7 stocks that we have in the terminal, it's actually up slightly, up four-tenths of a percent, which might be a little bit of a surprise, but that of course houses those Mag-7 stocks like Nvidia and other companies, but still, if you look at a year-to-date basis, the Nasdaq 100 is up about 16 percent, and that basket of Mag-7 stocks, trailing that, only up about six, seven percent relative to that, just because a lot of the plays have been more in the memory space and other chip makers. But of course, we have that other impact we're talking about economically when it comes to, how does this transition to jobs? And apparently, the fear of people worried about losing their jobs say AI.

Alexis Christophoros (1:21)

Everybody wants to know, okay, what is AI going to do to my life, to my pocketbook, to my job?

Jess Minton (1:27)

And how that affects your career, your families, your livelihood. And so who better to bring in than Tom Orlik, Bloomberg Economics Chief Economist, joining us from Washington, DC. And you have a new report that you put out today. Walk us through this about this AI apocalypse, potentially for millions of workers. And you ask, you pose that as a question. And you're saying the reality potentially, but maybe we're just not there just yet.

Tom Orlik (1:50)

So great to be here, Jess. So the big question, there's so many big questions about AI.

One big question is, what does this mean for the economy? Is this going to be a boom for worker productivity and wages? Is it going to make us all smarter, all better at our jobs, all more valuable to our employees? Or is this going to be something more like factory automation, which put a bunch of blue collar workers out of a job in the 80s, 90s and 2000s? Are we going to see a wave of white collar redundancies as Claude and other models put us out of a job? So Bloomberg Economics, we've been making the calculations, running the models and doing that for the US and a range of other countries. We don't have definitive answers, right? This technology is still evolving, but what we do have is a kind of a range for what the estimate might be.

At the top end, if we look at AI hitting its full potential, we're looking at hundreds of millions of workers, perhaps as many as 380 million workers worldwide, who are going to see their jobs significantly impacted, significantly disrupted by this new technology.

Alexis Christophoros (3:10)

When you say disrupted or impacted, does that mean they'll be using AI in some way in their jobs? Does that mean they will be displaced by AI? What can you tell us?

Tom Orlik (3:22)

So the way these calculations work is the first step is to break down a job into a set of tasks, right? And then to think about which of those tasks AI could do and which of those tasks AI can't do, right? So maybe think about two stylized examples, right? Think about a computer coder. Well, most of the tasks a computer coder does, what does AI can do? So computer coders are one of the jobs which has already been pretty significantly disrupted by AI. Well, now think about the other end of the spectrum. Think about perhaps a hairdresser.

Well, could AI help with the bookings? Sure, a little bit. Could it help with keeping up with latest trends, latest styles? Yeah, a little bit. But most of it, AI is not going to be able to do, right? So that hairdresser, their job is pretty secure. So what we did was we looked at all of the jobs in the economy, and then we broke those jobs into tasks, and then we looked at which tasks AI is going to be able to do, and which tasks AI is not going to be able to do.

For jobs where more than 50 percent of the tasks, more than 50 percent of what's done in that job, AI could have a significant impact, well, those are the ones which we include in our calculation. And if you add that up across all the countries we look at worldwide, well, that's how you get to our 380 million number for the number of jobs that are going to be significantly impacted, potentially, by this new technology.