Money Talks News may earn commission or revenue through links in the content below. Our editorial team independently selects all products. Compensation does not influence our recommendations.
Nvidia CEO Jensen Huang has a message for anyone worried about AI taking their job: relax. He recently told Axios that fears of a jobs bloodbath are “complete nonsense,” and that “AI is creating an enormous number of jobs, not taking it away.” (1)
Maybe he’s right. I hope he is.
But I was a stockbroker from 1981 to 1991, which means I spent the entire Rust Belt collapse watching the stock market climb to record after record. Just like it is today.
For example, in 1979, General Motors employed about 80,000 people around Flint, Michigan, and the city had nearly the second-highest average pay in America — roughly $90,000 a year in today’s dollars. Today GM employs about 7,600 in Flint, and countywide income has fallen to about half the state average. (2)
Of long-tenured workers who lost jobs in Flint and later found full-time work again, 36% ended up earning at least 20% less than before. (3)
The auto industry is the single biggest user of factory robots, and economists found each new robot erased about 5.6 jobs in the surrounding community. (4)
Did America lose jobs overall during those years? No. As autoworkers lost jobs, new work sprouted everywhere — in offices and information services. On paper, no net loss.
But a new information job in California was of no use to a 55-year-old assembly-line worker in Flint with a mortgage and no college degree.
That’s what the AI optimists keep skating past.
Here are five things Huang’s sunny forecast leaves out.
1. “No net job loss” means nothing if you’re the one who gets cut
The optimists love the aggregate number. “The economy will create more jobs than it destroys.” Maybe so. But you don’t live in the aggregate. You live in your house, with your bills, in your one specific career.
Flint is the whole argument in a single town. The jobs that vanished paid enough to put it near the top of the country. The jobs that replaced them didn’t. A statistic can recover while a person never does.
The lesson I took from watching it happen: the time to build a cushion is while your paycheck is still landing — not after it stops. The people who weathered Flint best had money set aside before the plant closed. The ones who got caught flat had nothing between them and the fall.
Why pay your bank fees while it pays you pennies?
Switching to a better bank account is one of the easiest edges out there.
If you’re still at a traditional brick-and-mortar bank, you may be paying monthly checking fees while earning almost nothing on your savings.
SoFi offers a combined checking-and-savings account with no account fees. With eligible direct deposit or $5,000+ in qualifying deposits every 31 days, you can earn 3.10% APY on savings — many times the national average — plus 0.50% APY on checking. New members may also qualify for a limited-time APY boost that lifts savings up to 3.80% APY for up to six months. (APYs are variable and can change at any time.)
New members who set up qualifying direct deposit may also be eligible for a cash bonus of up to $400, based on the amount deposited. Terms apply — see details.
Check out SoFi today.
2. The people promising you new jobs are the ones selling the machines
Huang isn’t a neutral observer. He runs the company that sells the picks and shovels for the entire AI gold rush. When the man who profits most from you adopting a technology tells you that technology is nothing but good news, that’s not a reason to panic — but it sure isn’t a reason to relax.
And notice who’s been getting the blame all these years. Politicians spent a decade pointing at China. Trade did ship some jobs overseas, no question. But the quieter, bigger thief was never China. It was technology.
Today, only about 286,000 Americans build the actual cars and trucks — a fraction of the workforce of the late 1970s. (5) Robots and software have been eating jobs since long before anyone had heard of ChatGPT.
So when someone promises the next wave of displaced workers — blue collar and white collar this time — will all glide into shiny new tech careers, that isn’t optimism. It’s a story that’s awfully convenient for the people telling it. This time the white-collar jobs are in the blast radius too, and research already shows AI replacing workers, not just helping them.
3. Even the “winners” usually take a pay cut
Here’s the trap in the happy talk. Even if you land on your feet, “landing on your feet” often means landing lower.
That 36% who took a 20%-plus pay cut? (3) Those are the ones who succeeded — they found full-time work. AI is already the leading reason U.S. employers give for layoffs, cited in tens of thousands of job cuts this year. (6) A smaller paycheck is survivable on its own. It becomes a crisis when you’re carrying debt built for the old paycheck.
That’s the thing to fix now, while you still have options. For example, high-interest debt is the anchor that turns a pay cut into a catastrophe. Cut it loose before you need to, not after.
If you have $15,000 or more in unsecured debt, National Debt Relief
How it works: fill out a quick form, and a certified debt specialist will review your situation. If they can help, they’ll build an affordable plan and estimate when you could be debt-free. There’s no upfront fee and no obligation
They can help with most unsecured debt — credit cards, personal loans, medical bills, even some student loan debt.
Check them out here.
One thing before we keep going — the financial world is louder and dumber than ever. Hot takes everywhere. Almost none of it is worth your time. I’ve spent 35+ years cutting through the noise so you don’t have to. Sign up for the free Money Talks Newsletter — 10 seconds, no spam, just the stuff that matters.
4. Your paycheck is a single point of failure
Ask any engineer about a single point of failure and they’ll tell you the same thing: if the whole system depends on one part, that part will eventually take the whole thing down.
For most people, that part is one job at one employer. It felt permanent in Flint too — right up until it wasn’t. You don’t control whether your industry gets disrupted. You do control whether every dollar you earn comes from one place.
A second stream of income won’t replace a career. But it’s the difference between a gap you manage and a gap that swallows you. For example, lots of companies let you earn money by filling out surveys, completing tasks, signing up for stuff, or playing games.
But Freecash
So try Freecash. It’s the fast, fun way to earn real cash. Check out Freecash here.
5. The career you’re counting on may end years earlier than you planned
Most people plan their finances around a working life that runs until they choose to stop. Flint taught me that the calendar isn’t yours to set. Disruption doesn’t wait for you to be ready, and it doesn’t care what year you’d penciled in for retirement.
If AI pulls your finish line forward by even five years, every number in your plan changes — how much you need saved, when you claim Social Security, how you draw it down. Those decisions are worth a fortune if you get them right, and they’re brutal to unwind if you get them wrong.
You don’t have to figure that out alone, and frankly, you shouldn’t. If there’s any time in life to get an expert second opinion, this is it, especially if your savings are substantial.
One Vanguard study shows DIY investors turn $500K into $1.7 million over 25 years – while those with advisors reach $3.4 million. You could be missing half your potential wealth.
A good financial advisor can also spot tax savings, Social Security strategies, and planning gaps you’d never see alone.
Finding the right advice has never been easier. For example, SmartAsset
$100K+ in investments? Get matched free in minutes.
The bottom line
I want Huang to be right. I’d love for AI to lift everyone, cure diseases, and hand us all shorter workweeks and fatter paychecks. It might.
But I’ve lived through enough of these promises to know how they work: The gains show up in a spreadsheet in someone’s headquarters. The pain shows up in a specific town, in a specific kitchen, at a specific age when starting over is hardest.
The men making these forecasts won’t be the ones absorbing the cost if they’re wrong. You will. So don’t organize your life around their optimism. Build the cushion, kill the debt, add a second income, get the plan right — and then it won’t matter whether Huang was right or wrong. You’ll be fine either way.
Hope is a wonderful thing. It’s just a terrible plan.
Sources: Axios (1); Bridge Michigan (2); U.S. Bureau of Labor Statistics (3); National Bureau of Economic Research (4); U.S. Bureau of Labor Statistics (5); Challenger, Gray & Christmas (6).
Read the full article here
