AI giants back $500M non-profit to retrain workers as automation accelerates job displacement

AI giants back non-profit to retrain workers left behind by AI

AI-POCALYPSE Several leading US AI companies joined with former US government officials on Thursday to form a bipartisan coalition focused on helping to prepare workers for the AI tsunami, even as many companies seem to be in a race to see who can replace human workers the fastest. Founded by former US Commerce Secretary Gina Raimondo and former Indiana Governor Eric Holcomb, RAISE US aims to "design and pilot new corporate incentives to retrain and redeploy workers, new approaches to support people through job transitions, and new training models tied to changing employer demand." The announcement talks up employer incentives but makes no mention of worker rights. It does, however, tease the possibility of wage insurance and career navigation "so changing jobs no longer means financial ruin." Winning political support for such benefits seems unlikely in a country where the federal minimum wage, frozen at $7.25 since 2009, "is at its lowest real value in 77 years," and healthcare costs could erase the solvency protection promised by wage insurance. Amazon, Anthropic, Microsoft, and the OpenAI Foundation - vendors of the AI models inspiring recent layoffs - are anchor partners in RAISE US initiative. But its corporate backing is broader still, with financial sponsorship from Bank of America and the support of more than two dozen major companies and foundations. Amazon, having sacrificed 14,000 jobs on the altar of AI transformation last fall, said, "For Amazon, joining RAISE US is a natural extension of what we have been doing for years: investing in people, partnering with governments, and building programs that help workers and communities succeed." Microsoft, which ousted about 9,000 employees last July and recently dangled buyouts before a similar number of staff, offered a similar endorsement from VP and president Brad Smith. RAISE US intends to focus on: state workforce policy and programs; employer-driven worker transition plans; worker education and re-training programs; and policy recommendations. "America has a technology strategy for leading the global AI competition," said Raimondo, who will serve as CEO of RAISE US, in a statement. "It does not yet have a people strategy - and we cannot lead without one. If we build the best AI systems in the world and leave millions of Americans behind, we won't have won anything; we'll have automated our own decline." We haven't yet automated away software developer roles, but there are signs that's happening for designers and marketers. A recent employment report from venture capital firm SignalFire notes that tech hiring is at 25 percent less than what it was before the 2019 COVID pandemic, on a 12-month trailing basis. But some jobs have fared better than others. Engineering hiring is down only 11 percent during this period at major tech companies and is up seven percent at startups. Designers have fared worse, with hiring down 48 percent at large tech companies and down 22 percent at startups. Marketing roles have declined 36 percent at large organizations and are down 18 percent at startups. And among product managers, hiring is down 39 percent at tech giants but up two percent at startups. Amid this overall retrenchment, software engineers are proportionally more in demand, accounting for 55 percent of tech hiring, compared to 46 percent seven years ago. The AI job apocalypse is most evident among new hires with less than a year of experience, and college graduates. SignalFire's data shows that in 2016, about 22 percent of new hires at major tech companies had a year or less of experience. Today, that figure is about eight percent. Among startups, where about 15 percent of new hires were inexperienced a decade ago, today that number is just three percent. "The critical systemic risk arises when an entire industry stops investing in early-career talent," SignalFire says in its report. "By eliminating its new grad pipeline to optimize current balance sheets, the tech industry could face a severe leadership vacuum over the next decade." RAISE US certainly has its work cut out for it as its members keep cutting jobs. ®

One of the Democratic Party's brightest stars is co-founding a group to help with the coming AI jobs earthquake | Fortune

Critics warn of doomsday scenarios out of a sci-fi thriller, while backers say AI will generate so much new wealth that no one should worry too much about millions of layoffs. A new bipartisan nonprofit hopes to ensure that America can realize the economic gains promised by AI without its workers suffering. RAISE US is starting with more than $500 million to deploy on new forms of education and training, putting a focus on partnering with states and major employers rather than the federal government. Founded by former Commerce Secretary Gina Raimondo, a Democrat, and former Indiana Gov. Eric Holcomb, a Republican, the group aims to pilot programs and incentives to help American workers pivot to new careers in an economy that will increasingly be automated by artificial intelligence. "We're talking about a certain level of unemployment that could destabilize our country and our democracy," Raimondo said in an interview. "If you want to lead the world in AI, you have to take action to make sure our democracy doesn't crumble." The programs will first start in Arkansas, Maryland, Utah and Connecticut The nonprofit is initially partnering with officials in Arkansas, Connecticut, Maryland and Utah, along with several of America's largest companies and charitable organizations. The group intends to develop policies that connect schools more closely to employers, so that layoffs can be replaced by the potential for new jobs with higher incomes. They also are exploring changes to corporate taxes and other incentives with the goal of keeping people working. "Good things tend to happen when you convert have-nots into haves," Holcomb said. Among the companies serving as anchor partners with RAISE US are Amazon, Microsoft, Anthropic, the OpenAI Foundation and Bank of America. Other employers involved in the project include UPS, General Motors, Eli Lilly, Mastercard, chipmaker AMD, Cisco and IBM. Raimondo, the former Democratic governor of Rhode Island who played a formative role in setting AI policy as the Biden administration's commerce secretary, will be the nonprofit's CEO. The advisory board includes former Republican House Speaker Paul Ryan, billionaire investment manager Stephen Schwarzman, AFL-CIO President Liz Shuler and the economists David Autor, Erik Brynjolfsson and Raj Chetty. AI has the potential to displace human workers from factories to offices An April analysis by the Boston Consulting Group estimated that roughly half of U.S. jobs will be reshaped by AI over the next few years. The analysis said that as many as 25 million jobs could be eliminated in the U.S. over the next five years. Goldman Sachs, in March, separately released an estimate that a quarter of U.S. work hours could be automated by AI. More than just a glorified search engine or a generator of video clips and novelty images, AI could fill roads with driverless trucks, create factories staffed by robots and supplant office workers, lawyers and doctors. President Donald Trump has expressed little anxiety about the possibility of AI displacing human workers. Asked on Tuesday ahead of touring a Mack Trucks factory in Pennsylvania if AI could cause truckers to lose their jobs, Trump told a reporter, "Right now, they're not." The president has been banking on the buildout of AI data centers and power plants to drive hiring and overall economic growth. While AI-related investments have helped the economy, manufacturing has shed 68,000 jobs and the trucking transportation sector has cut 28,300 jobs since the start of Trump's second term, according to the Bureau of Labor Statistics. "We have, right now, so many jobs that are going to be available and the biggest problem we have is getting the people," Trump said. "So we're really doing spectacular." Experts say education systems and labor policies aren't built for an AI economy AI experts have warned of gaps between the transformations that AI could create and a 20th century social safety net of unemployment insurance and four-year college that seems ill-prepared for the scope, scale and speed of the change. "AI is now disrupting multiple sectors simultaneously, faster than any institution can respond," said Vivienne Ming, a neuroscientist who has written the book, "Robot-Proof: When Machines Have all the Answers, Build Better People." Ming said that she agrees with an argument by economists that the wealth generated by AI could create demand for more workers that could offset any job losses. But she said the skills that matter in an AI economy go beyond professions such as plumbing or construction and involve curiosity and intellectual flexibility. "Neither our education system nor our labor policies are building the foundational human capital that AI-era work actually requires," she said. Raimondo said the new nonprofit wants to use states as a vehicle for testing ideas that Congress can later embrace as policies, paving the way for the possibility of more profound changes to both the tax code and the educational system. "I don't have a lot of hope for bold action by Congress in the next few years on this issue, and I don't think we can wait a few years," she said. "I also think there are many examples in history that when the federal government does take action, they will look around at what has been working in states. I feel pretty confident that they will look at the work that we've done."