Cathie Wood-Led Ark Sees AI-Created Market Opportunities Leading To Higher Employment, GDP

Zinger Key Points
  • Ark researchers feel AI breakthroughs could catalyze another period of accelerated declines in working hours per employee.
  • AI would be the 'assembly line' for knowledge workers, said the researchers.
  • The authors said it can arguably lead to a better quality of life, despite a decline in average working hours.

In late November, artificial intelligence research and deployment company OpenAI released its bot ChatGPT which took the internet by storm.

What Happened: Millions of people have asked the bot to write codes and essays and even sought advice on a wide spectrum of topics ranging from dating to career.

See Also: How To Invest In Startups

One of the first questions to pop up following the bot’s success, especially among journalists, writers and programmers was will the job market be ever the same. Cathie Wood’s ARK Investment Management has a different and optimistic take on the matter.

An article authored by Frank Downing, Director of Research, Next Generation Internet at ARK along with Andrew Kim, asserts the market opportunities created by AI have the potential to lead to much higher employment and gross domestic product, or GDP, and arguably a better quality of life, despite a decline in average working hours.

The Argument: The authors said that while the U.S. labor force has grown consistently from 12 million in 1870 to more than 150 million in 2021, the number of labor hours per employee has declined at a compound annual rate of 0.37% per year. “Thanks to technologically enabled innovation, labor is producing more while working less,” they said.

The authors cited the example of Ford’s pathbreaking concept of an assembly line in the early 1900s that accelerated the annual decline in working hours per employee more than four-fold to ~1.39% per year until the Great Depression and World War II arrested it.

They further explained that generative AI breakthroughs like ChatGPT and Dalle-2 this year could catalyze another period of accelerated declines in working hours per employee. This time around, AI would be the "assembly line" for knowledge workers, reducing annual labor hours per employee at a rate not seen since the early 1900s,” they said.

The authors said that drawing the conclusion that this innovation will result in widespread unemployment harkens back to centuries-old responses to technological disruption.

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