Last week the New England Chapter of National Association of Corporate Directors zoomed a lengthy panel program discussing the likely future impact on the US job markets of the emergence of pervasive AI at all levels of business operations. (Note: I am on emeritus board of this very active chapter; if you are interested in exploring membership, either as you are a director or for your entire board, please let me know.)
Panel: the obligatory Harvard professor; chair is a director of a well-known public company; two very senior operational folks in charge of “people” at their respective significant companies.
Conclusion: jobs need not shrink in number as compared to future work force size; jobs will change and companies need to take specific action to be successful in training personnel to achieve corporate success.
Key take-aways:
- AI will permeate both manual tasks and cognitive tasks. It is the job of the company, led by its board, to get the right kind of management to orchestrate this result. AI model capabilities will continue rapid acceleration so action is needed yesterday. We knew this a decade ago….
- There will come a time when you will not need human beings to physically do anything, whether manual or at management level, other than creating and supervising AI agents that direct robotics to do manual labor and AI to do cognitive development of what is needed: new agents, control mechanisms for extant agents, analysis and control of marketing, production, shipping, etc.
- Demographics world-wide for advanced economies show fewer working-age people in the future. This presumably might help offset any inherent shrinkage in job slots. Payment for these people will need to be geared to how many people these workers must support.
- How to understand existing workforce and innovation (factoids): since 1950 labor force increase greatly impacted by female employment; over time talent and tech savvy have increased, creating innovation=companies=job needs; in US note incredibly important impact of immigration (subtext is limiting immigration is error)(in 1975 one in 12 patents were issued to immigrants from Asia or Hispanic regions while in 2020 it was one 3; today in Silicon Valley immigrants file as many patents as the aggregate of the least inventive 31 US States; implication is that restricting immigration is a major error.
- Key role of management is to understand the above and: deploy AI at all levels; supervise the training of employees to fulfill new roles (see 2 above).
- Random examples of impact I found to be fascinating: a) driving delivery vehicles is the major employment today in over half of all States in the US. All of these jobs will disappear. b) today about 1% of the labor force of longshoremen still survives; today people sit in offices managing containers, boats, trucks, cranes at higher-paying job while costs fall to consumers for the cost segment of transport. [Note: these stats are in my note, are startling, have not been verified by me in any regard. Startling if accurate or close to accurate….]
- What is role of HR? To cause employees to embrace technology, feel part of the process rather than threatened. Jobs are changing, not disappearing. Hire managers who understand this and train people. Motivate people to enter careers requiring skills we need. Hiring is the most important thing for boards to supervise.
- Boards must lead in hiring management that will be amenable to identifying which parts of your business is likely to be disrupted by new technology, in both the manual and cognitive sectors–and how do you adapt faster than your competitors. Proactively pursue AI–everyone else is and it will disrupt everything. Hire leaders who buy into this; they must learn to use agents, be aware of tech security. Management and workers must be able to create agents outside of the tech department; everyone must be able to create software.
Bottom line for boards of directors: you must be tech savvy to understand disruption, HR impact, choice of management. Bottom line for management: you are now going to supervise radically different business models with radically different labor forces which will require a completely different mind-set. This is my takeaway from this granular program. I see this happening in my law firm, and in the management style here. Tomorrow is today….