Earlier this year, India released its annual Economic Survey. Interestingly, the 2024-25 Economic Survey has a chapter titled ‘Labour in the AI Era: Crisis or Catalyst’. The Chapter takes a realistic stock of AI adoption trends and forecasts. It concludes that “estimates about the magnitude of labor market impacts (by AI) may be well above what might actually materialize.” Given the nascent stage of AI development and deployment, the National Economic Survey refrains from deterministically predicting the impact of AI on the labor market.
However, the survey poses an important question worth considering: “What were the problems in the world that demanded AI as the answer?” In other words, is AI a solution in search of a problem?”. This question is to be read in light of India’s unemployment crisis. The International Labor Organization’s India Employment Report 2024 revealed that the proportion of educated youth who are unemployed doubled from 35.2% in 2000 to 65.7% in 2022. The trend of AI adoption raises alarms about automating jobs, especially white-collar jobs. In October 2024, it was reported that Indian fintech company PhonePe laid off 60% of its customer support staff over the past five years as part of a shift to AI-powered solutions.
I agree with you, it was more of a commentary on “what would happen if we had AGI tomorrow”.
We’ve been 3 months away from AGI for a few years now and it’s debatable if we’ll ever get there with LLM’s. Looking into the results of AI tests and benchmarks show that they are heavily gamed (tbf, all benchmarks are gamed.) With AI though, there’s so much money involved, it’s ridiculous.
Fortunately it looks like reality is slowly coming back. Microsoft’s CEO said that something like “AI solutions are not addressing customer problems.” Maybe I’m in a bubble but I feel like overall, people are starting to cool on AI and the constant hype cycle.