An AI-Powered Economy (Part 1/2): How Will We Pay Bills When AI Takes Our Jobs?

Welcome to this week’s Deep-fried Dive with Fry Guy! In these long-form articles, Fry Guy conducts in-depth analyses of cutting-edge artificial intelligence (AI) developments and developers. Today, Fry Guy dives into the future of the economy in an AI world (Part 1/2). We hope you enjoy!

*Notice: We do not receive any monetary compensation from the people and projects we feature in the Sunday Deep-fried Dives with Fry Guy. We explore these projects and developers solely to reveal interesting and cutting-edge AI developments and uses.*

AI will hit the labor market like a “tsunami,” and “we have very little time to get people ready for it.”

These are the famous words of International Monetary Fund managing director Kristalina Georgieva, and the truth of this statement is being felt around the world. Anxiety is striking workers across the globe in anticipation of an AI overhaul in the workplace. Is this an overreaction, or are we all about to be replaced? Let’s explore.

WILL AI FORCE RETIREMENT?

Imagine a world where you could retire tomorrow with all the money you could ever need … a world where you could live without worrying about money ever again. You could travel to exotic places like Croatia, Tahiti, Serbia, and Japan. You could buy that dream vacation home in the Smoky Mountains and drive your new Tesla convertible with the top down.

As crazy as it sounds, this seemingly unrealistic scenario is possible, and it could happen within the next 5-20 years. If it does, you won’t have to work ever again, and you’ll get paid for doing nothing. All you’ll have to do is check your bank account for the weekly deposits.

Since the release of ChatGPT in 2022, stories of AI causing mass human unemployment have been flooding the internet. This is causing a lot of fear in the workforce. Today, more than 86% of workers fear that their job could be lost to AI, and almost one-third of those people think it will happen within the next five years.

This fear does not come without some substantial evidence, as companies of all sorts are beginning to make moves towards AI. Some examples include IBM, which replaced thousands of employees with AI last year, and Google, which plans to lay off over 30,000 this year. These job cuts follow the global trend of downsizing manpower in the technology sector and replacing it with AI. In the past two years alone, over 200 companies have cut over 50,000 human jobs, including tech giants such as Alphabet, Apple, Amazon, Microsoft, and Meta. This is happening within small companies as well. For example, the investment firm Blackrock recently dismissed around 600 employees, citing new technologies like AI as the reason.

If you think these numbers are large, this is just the beginning. As AI gets better and becomes more affordable than humans, humans will find themselves on the streets. Data entry clerks, drive-thru workers, and accountants could lose their jobs first. That’s because AI, as it stands right now, can do all of these jobs with a high enough level of competence. Companies like Wendy’s, for example, are already using AI drive-thru workers instead of humans to save money. At the end of the day, numbers drive business. For example, California recently passed Bill AB 1228 which sets a $20/hour minimum wage for human fast food employees. This led to the cutting of over 10,000 state jobs across the industry. Why pay 16-year-old kids $20/hour to sit on their phones all day when you can have AI do the work instead? Not to mention, Wendy’s has publicly stated that the FreshAI system is more accurate than humans and saves an average of 22 seconds per order. It’s worth mentioning that the system will continually learn over time to get even better.

Eventually, the AI job takeover will creep outside of simple positions like fast food drive-thru workers and will aim for more complex jobs—jobs that not only take smarts but ones that require physical skills as well. This will include jobs ranging from plumbers to operating surgeons. So when your toilet is broken, instead of calling a human plumber with his pants too low, you’ll call a robot plumber and pay half the price. And in exchange for a human doctor operating on your broken leg, an AI robot named “Dr. Singularity” will perform the procedure for you in half the time.

Although this reality seems a bit exaggerated, it’s not too far-reaching. It’s just a matter of time before skilled robots begin taking mass amounts of jobs. Tesla is working on its Optimus robot for factory work, and Boston Dynamics has unveiled Atlas, with increased mobility and dexterity. These companies and more have working prototypes that are on the verge of surpassing human abilities on a variety of tasks. As a result, an integration boom is lurking. In fact, we are already beginning to see the employment of AI-powered robots. For example, Figure AI’s humanoid robot, Figure 01, just got its first job at BMW (below).

These AI-powered systems are getting smarter every day, and once they surpass human intelligence, almost every job will be overtaken by AI. People like Elon Musk agree. He said, “If you define AGI (artificial general intelligence) as smarter than the smartest human, I think it’s probably next year, within two years.” Shortly after this happens, Musk believes that “Probably none of us will have a job.” Musk isn’t alone. The Godfather of AI and former Vice President of engineering at Google, Geoffrey Hinton, thinks that job loss due to AI will be “significant” and is “very worried about AI taking lots of mundane jobs.”

Goodbye humans, and hello AI-powered robots.

HOW WILL WE PAY OUR BILLS WHEN AI TAKES OUR JOBS?

If AI takes over the workforce, what will we do? And how will we pay our bills without income? Well, at first, the transition from a human workforce to an AI dominated one will feel slow. AI workers will be gradually incorporated into the world, as we have already begun to see. They’ll work side-by-side with humans. You might see a human and robot crew repairing highways, for example, or AI-powered humanoid robots working alongside human factory workers to help make things like the newest version of the iPhone or the newest Tesla cars. Chances are, you’ll even have an AI robot doctor in conjunction with your human primary care doctor to help perform your yearly physical checkup and administer vaccines. This will mark the beginning of the end.

After AI and humans tag-team the labor market for a while, we’ll realize that robots can do the job without us. Robots will be able to do everything themselves and won’t need to be babysat by their human counterparts. At this crucial moment in time, robots will take over 90%+ of the entire workforce. Humans will be fired from their jobs and the effective unemployment rate could climb close to 100%. Regardless of age and expertise, humans will be forced to retire in wake of massively superior AI systems.

Although an AI workforce takeover seems awful at first, there is a silver lining. Many experts believe that this realistic scenario, driven by massive AI development and implementation, will lead to Universal Basic Income (UBI). This is the idea that the government will pay its citizens to do nothing. Every single person, no matter how rich or poor, would get paid a salary. Things like poverty would essentially be eliminated in the United States and around the world, and people would only have to “work” if they want to.

PAUSE! UBI is a polarizing topic, but if the situation we have outlined plays out and 90%+ of humans lose their jobs, some form of UBI would be needed to make up for all the lost wages. People will still have bills that need paid regardless of their employment status. Because money would be evenly distributed, some experts believe this UBI could range from $100,000 to $300,000 per person annually. This is big time money for many people. Elon Musk expressed, “We won’t have universal basic income. We’ll have universal high income,” meaning everyone could be modestly rich by today’s standards.

If this plays out, people would never have to worry about money ever again. They could instead hang out with their friends, dabble in the arts, exercise, and watch as much sports as they please (if athletes still want to play). Their main worry of financial stability would be wiped out altogether. Not to mention, there would be an abundance of goods. AI automation will reduce labor and bring the prices of almost everything down dramatically, leading to more innovative and efficient production of goods and services. People would be able to buy almost anything they’d like at any time. The dream life we described at the beginning would truly be a reality.

A DREAM OR A NIGHTMARE?

We’ve begun digging down the rabbit hole, so let’s keep going. If all this plays out, the frenzy of everyone in the world “hitting the lottery” at once will be short lived. Like humans inevitably do, we will begin to look for more. We will get bored of sitting around doing nothing, and the ambitious chase for dreams will be crushed. There will be nothing to strive for, and nothing left to buy—we will have it all.

At this time, people will begin to long for the days of complaining about their jobs, because those jobs gave their lives a sense of meaning. The very things we once desired most will end up being the things that crush our spirits. And the thing we despised the most—work—will be the very thing that gave meaning to our lives. We will see massive waves of depression, higher than we have ever seen, with no sense of purpose in life and nothing to strive for. This reality is backed by data, as a recent study found over 40% of retirees face clinical depression. If AI forces retirement, this number could be even higher for young people, who never got the chance to work a meaningful career.

To deal with this depression and loss of meaning, people will probably create “fake jobs” or resort to hobbies of various kinds. People might begin farming, for instance, even though AI will have replaced John Deere tractors and be providing more produce at quicker rates than ever. These tasks will be undertaken solely to give humans a sense of purpose—a sense that they are on this earth for a reason.

The problem is that it will take a highly self-motivated person to work a fake job or pursue a meaningful hobby. This will be the type of person who can force themselves to wake up before sunrise to tend to their crops, even though they know a robot could do it for them with the touch of a button. Or the person that spends hours writing poetry that pales in quality compared to that of the most advanced large language model (LLM). Most people won’t have this type of willpower, and for many it will seem defeating and silly. The people that succeed at finding meaningful hobbies or create “fake jobs” will discover purpose in life and escape this existential dread. The people that don’t (in all likelihood the majority) will probably turn to drugs to help them deal with their depression. Here, AI might come to the rescue. It will have the ability to create drugs and even provide gene editing with CRISPR technology to help those with unmotivated personality types cope in the post-labor world.

To some, this picture might seem dark and scary. For others, it offers relief from their current struggles and hope for the future. Regardless, in the words of Elon Musk, “These are not things that I wish will happen; these are things that I think probably will happen.”

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Now you know how humans might react to an economy overtaken by AI. But how will AI and humans get along in such a world? Will humans essentially be the pets to their AI overlords, will AI wipe out the entire human race, or will humans have full control over AI, and as a result, live in a new age of prosperity unlike anything in human history? These are the questions we will explore in “An AI-Powered Economy (Part 2/2)” next week!