QUICK TAKE: 13 million jobs at risk when global AI tsunami hits Spain
How are all the AI refugees supposed to pay for real life?
The IMF published a bombshell new report (full pdf) yesterday on how artificial intelligence will smash through job markets around the world.
The headline is that AI will affect a massive 40% of jobs globally overall, a figure that rises another staggering 20 points in advanced economies: “In advanced economies, about 60 percent of jobs may be impacted by AI”, it says, adding that: “Roughly half the exposed jobs may benefit from AI integration, enhancing productivity. For the other half, AI applications may execute key tasks currently performed by humans, which could lower labor demand, leading to lower wages and reduced hiring”.
Spain is classed as an advanced economy. There are 21.3 million Spaniards with a job, according to the latest INE figure for the third quarter of 2023. Sixty percent of 21.3 million is…12.9 million people. If the split is half-and-half as the IMF suggests, six-and-a-half million people will need to rush to work out how to keep their jobs with some level of AI integration, and the other six-and-a-half million are gone or reduced to some very low level of income. Unemployment is still at just under three million people in Spain anyway. Three million plus another six million AI refugees would be nine million, 38% of the active population (adults available for work).
The report further notes that: “AI could also affect income and wealth inequality within countries. We may see polarization within income brackets, with workers who can harness AI seeing an increase in their productivity and wages—and those who cannot falling behind”. So some of the already very rich, the top 1% people, get much richer with many fewer employees to worry about or pay for. At the bottom end, it is hard to imagine AI replacing plumbers, hairdressers, nurses or fruit pickers in fields.
What on earth are politicians anywhere, and in our case Spain, supposed to do with such a tidal wave of economic disruption over the next decade? What are all of those people suddenly supposed to do to pay for real life? What are we supposed to tell the kids, or train the next generation to do? How many socio-economic structures are about to suffer extreme pressure? How many existing real-world business hierarchies die? How indeed, will AI change politics itself, not only the more direct propaganda or electoral manipulation stuff but on a deeper ideological, philosophical or policy level?
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Interesting. Politicians are on a frágil platform already, so how will they deal with further unrest? It's likely to be exploited by extremists and populists, in the same way as Hitler exploited the depression. However, it cant remove the physical requirement for human shelter, food and water. And Spain has potential for plenty of those jobs. (though not so much water at the moment!)
Fewer employed means less income tax collected, means a massive shift in taxation will be needed,
from income to consumption, and corporate profits. We all know that governments are tax junkies - they simply can not live without it. And with the liklihood of many more of the population without jobs, the need for government to raise inome will only increase. Difficult times ahead.