The "Godfather of AI" has been on these pages before. See X-Files or Poltergeist? (November 2024). That post is about the British computer scientist who has spearheaded the intelligent things movement, which is generalized with the label "artificial intelligence." Last year, he was warning that humanity was not ready for "what is coming," and frankly, that we do not understand it. Some of us are striving to.
Recently, I have posted about the economics that impact us all. See Opportunity Cost (October 2025), Utopia is not Coming (October 2025), but that is a central theme of medical care delivery, business operations, and more. See It's Simple Economics (March 2021), How will you take your profit? (February 2014).
As an aside, there is no such thing as "simple economics." The world we live in is a vastly complex conglomeration of competing interests, priorities, and influences. There are various pressures on economic activity, drivers of both supply and demand, and they are all in a matrix. This was recently illustrated by comments of the Chair of the Federal Reserve, discussing experience and indicators.
Yahoo Finance recently reran a Fortune story in which Jerome Powell discusses layoffs and the American job market. These are factors intertwined with the larger picture of monetary policy, debt, and money supply. All very heady stuff. There are varied beliefs about the Federal Reserve, the supply of money, and the national interest. I leave that to your own research and conclusions.
But Powell focused on workforce demand, layoffs, and the near-zero increase in job availability. The labor market is tight. Despite that, he noted, consumer spending is still holding up and "inflation remains elevated ... even as hiring slows." He sees a conundrum for the money supply (Fed interest rate) debate.
He says that "AI and automation are boosting output," and that means economic growth. But, with AI and robotics, this is occurring "with fewer workers, leaving the labor market softer even while GDP stays positive." So, the inflation says money should be tightened (raise interest) and the lower employment supports lower interest rates, which would stimulate spending and perhaps investment in business expansion (hiring).
This is critical because it illustrates that the expected paradigms can be changed in a fundamental way by the application of technology. Though that may seem a revelation, I would suggest the same was true in each of the four industrial revolutions (yes, your high school history teacher shortchanged you when they said there was "an" industrial revolution).
AI and robotics are currently shifting the economic curves, with increased production and diminished labor. For a simple illustration, the same expansion/contraction paradox occurred when tractors appeared on family farms. Productivity was simpler and therefore increased, and fewer farmhands were needed/hired.
But, returning to the "Godfather," Fortune reports he has "doubled down" on his premonitions regarding AI. He contends there are two ways to profit from AI, and those are selling subscriptions to those who want to use the tools and decreasing labor costs as a result of increasingly proficient and efficient workers.
He acknowledges that this is not new, accepting that "some economists point out previous disruptive technologies." Nonetheless, he believes that the changes in labor will be "massive job replacement by AI," as that is the side of his analysis that promises the most pervasive and intensive economic opportunities. Said differently, there is more money to be made in using AI than in selling AI tools.
Therefore, Hinton perceives the current AI spending boom as driving the economy at least near term. The longer term, from his perspective, is clearly and certainly going to bring job and even profession destruction, decreased demand for human input, and AI will "replace human labor" in a variety of ways.
This is likely to start with the entry level, but is unlikely to remain there. Entry-level job openings have decreased "roughly 30%" in recent years, "since OpenAI launched ChatGPT." He sees these as socital challenges, business challenges, and human challenges.
To make the equation more complex, there are human challenges like the birthrate. See Approaches to Data (May 1028). Birthrates in many countries are dropping. There are nations that are essentially shrinking while others are growing (in comparing birth and death rates). Complicating that is the legal migration between countries and the illegal incursion over national borders.
Thus, each person will face their own challenges of employment, finance, growth, and progress/prosperity. Various vocations and engagements will fluctuate. Nations will struggle individually with shifting economics, influences, impacts, and effects. In short, the most likely answer to almost any economic question will remain "it depends."
There will be an end to jobs in the buggy whip industry. It's Just a Question of When (March 2025). There will be opportunities in the data center industry. There will be a mixture of workplace and occupation evolutions, revolutions, dissolutions, and innovations in a spectrum in between.
The economy and your place in it will likely be less predictable than your parents'. But remember, theirs was likely less predictable and stable than your grandparents. Historically, there were entire generations who persisted on a family farm or worked in a particular industry, company, or even factory.
Change is not new. Unpredictability is not novel. The pace of change is increasing. The challenges will confront us all. Expert paradigms will be reconsidered, past bedrocks will be reexamined, and assumptions will be as analyzed as new revelations. The best and brightest will no more "know" the future than the rest of us.
Hinton says that the change is really deeper; it is about societal organization. Nonetheless, collectively and individually, outcomes will depend on attitude, engagement, and persistence. And you get to choose your own.
