The AI Gold Rush Is Cover for a Class War
The tech giants behind the AI boom have become too big to fail and are using their position to mount an assault on labor.
Under the guise of technological inevitability, companies are using the AI boom to rewrite the social contract. (David Paul Morris / Bloomberg via Getty Images)
While official unemployment remains low, America’s labor market is stagnating: wage growth has slowed, job creation has weakened, and labor force participation is in decline. White-collar employment, particularly in tech, has fallen by 1.9 percent since its peak in 2022.
This may sound modest, but previous recessions in 2008 and 2020 began with similar declines. In the tech industry, layoffs are up 36 percent from last year. What began in 2022 as start-up downsizing has since spread to larger, higher-profile companies such as Microsoft, Google, Salesforce, and Meta.
Automation Pressures or Cost Cuts?
Mainstream explanations attribute these cuts to the rise of artificial intelligence (AI). Generative AI, a branch of machine learning that draws associations across massive data to generate images, text, or predictions without preset instruction, has been cast as a disruptive force capable of reshaping society. The CEO of Anthropic, one of the leading generative AI firms, says we need to stop “sugarcoating”: AI could “wipe out half of all entry-level white-collar jobs and spike unemployment to 10-20 percent in the next five years.”
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