What Happens When AI Takes 15 Million American Jobs ?

About 4.3% of the workforce is unemployed, roughly six million people, based on BLS April data. Credible estimates of AI job destruction range from 11 million to 19 billion, implying that at the high end about 15% of the workforce could be out of work. Without major restructuring of how Americans live financially, the labor market and national economy would not survive because individual spending would collapse and GDP would plunge. The optimistic idea that AI growth will create new jobs is viewed as unconvincing, since the jobs created are unlikely to match the scale of displaced work. Universal basic income is proposed, but personal taxes are not realistic and business taxes would face customer losses. Funding would likely need to come from taxes on AI companies, depending on political leverage and whether partial nationalization occurs.

"About 4.3% of America’s workforce is unemployed today, based on the BLS April data. That is about six million people. Credible estimates of AI job destruction range from 11 million by Goldman Sachs to 19 billion by Tufts/Digital Planet. At this high end, 15% of America’s workforce would be out of work, including the 4.3%."

"To start, without a major restructuring of how Americans live financially, the US labor market, and probably the national economy, would not survive. So much individual spending would disappear that GDP would plunge. The most optimistic range of solutions is that AI-driven economic growth will create a new generation of jobs. It is not terribly convincing. What could those jobs possibly be? They won’t be coding or building robots."

"At the far end of the solution spectrum is "universal basic income." The idea that all people displaced by AI would receive income from the federal government is probably due to the difficulty of imagining where that income would come from. At one level or another, OpenAI's Sam Altman and Elon Musk have used this trial balloon. The source of UBI cannot be personal taxes. Too many people will be out of work for it to be realistic."

"This leaves a huge tax on the AI companies themselves. Presumably, these companies would be so wildly successful that they could provide hundreds of billions of dollars to the US government to support an army of the jobless. Presumably, also, these people would live lives of comparative leisure, although who knows what that life of leisure will be in the future. And will the AI corporate giants pay? That depends on the leverage Congress and the President have."

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