Microsoft just announced they’re laying off another 9,000 people. With AI and offshoring rapidly eliminating jobs, are we about to see a new wave of unemployment?
AI Eats Engineering Jobs
New comp sci graduates have one of the highest unemployment rates of any major. Big Tech companies are doing hiring freezes and layoffs.
AI is driving this rapid slowdown in engineering jobs. An engineer skilled in AI can produce far more than before.
In fact, coding is what AI does best. But LLM’s are coming for other cognitive tasks.
I expect routine work in customer service and legal to be automated soon. And once AI masters driving, watch out. Truck driver is the most common job in 29 states.
But it’s not just computers that are coming for your job. It’s humans — overseas.
Our Man in Cairo
Whatever companies can’t automate, they’re offshoring.
“We have a guy in Egypt that does all our cold calls for us now,” a friend in sales told me this weekend. “He speaks perfect English. And it’s only $500 a month.”
A couple of years ago, his company would’ve hired an American fresh out of school. Not anymore.
The quality of talent available overseas is insane. We can hire the best students in their whole darn country for a fraction of what mediocre Americans cost. They work harder and turnover is lower too.
Adapting Is Harder Than It Looks
Between automation and offshoring, lower end desk jobs are rapidly disappearing. If prior waves of job losses are any indication, it will be hard for laid off Americans to adapt.
In 2008, Janesville, Wisconsin lost their GM plant. It employed 7,000 people at its peak, perhaps 1/6th of the town’s workers.
I was living just up I-90 from there in Madison at the time. I remember the plant closure being all over the news.
I recently read a book about Janesville. It turns out that despite the workers’ best efforts to retrain, 3/4 of them said they were worse off 5 years later.
Half the laid off families struggled to afford food. Children became homeless.
This is the future for a lot of laid off Americans. Adapting is harder than it looks.
Wrap-Up
AI and offshoring will decimate the lower end of the job market over the next decade.
Many of the displaced workers will struggle. They could form a potent political force.
My best advice on how to win in this new era is to embrace AI. Use it every day for every task.
If you can do that, you’ll be one of the winners in this new world.
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