AI: AI may not steal many jobs after all. It may just make workers more efficient

AloricaAn Irvine, California-based company that runs customer service centers around the world has unveiled an artificial intelligence translation tool that enables its representatives to speak with customers who speak 200 languages ​​and 75 different dialects.

This way, an Alorica representative who speaks, for example, only Spanish, can handle a complaint about a faulty printer or an incorrect bank statement from a Cantonese speaker in Hong Kong. Alorica would not need to hire a Cantonese-speaking representative.

Such is the power of AIAnd, potentially, the threat: maybe companies won’t need as many employees and will cut some. jobs – if chatbots can handle the workload instead. But the problem is that Alorica isn’t cutting jobs. It’s still hiring aggressively.

The experience at Alorica – and at other companies including furniture chain IKEA – suggests that AI may not be as job-destroying as many fear. technology They might turn out to be more like advances of the past (the steam engine, electricity, the Internet): that is, eliminating some jobs and creating others, and probably making workers more productive overall, to the ultimate benefit of themselves, their employers, and the economy.

Nick Bunker, an economist at the Indeed Hiring Lab, said he thinks AI “will impact many, many jobs, maybe all jobs indirectly to some extent. But I don’t think it’s going to lead to, say, mass unemployment. We’ve seen other big technological events in our history, and those didn’t lead to huge increases in unemployment. Technology destroys, but it also creates. There will be new jobs.”

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At its core, artificial intelligence enables machines to perform tasks previously thought to require human intelligence. The technology has been around in early versions for decades, having emerged with a problem-solving computer program, the Logic Theorist, created in the 1950s at what is now Carnegie Mellon University. More recently, think of voice assistants like Siri and Alexa. Or IBM’s chess-playing computer, Deep Blue, which managed to beat world champion Garry Kasparov in 1997. AI truly burst into the public consciousness in 2022, when OpenAI introduced ChatGPT, the generative AI tool that can hold conversations, write computer code, compose music, compose essays, and provide endless streams of information. The advent of generative AI has raised concerns that chatbots will replace freelance writers, editors, coders, telemarketers, customer service representatives, paralegals, and many more.

“AI is going to eliminate a lot of today’s jobs and it’s going to change the way a lot of jobs work,” said Sam Altman, CEO of OpenAI, at a panel discussion at the Massachusetts Institute of Technology in May.

However, the widespread assumption that AI chatbots will inevitably replace service workers, in the same way that physical robots took over many jobs in factories and warehouses, is not becoming a reality on a widespread basis (at least not yet, and perhaps never will).

The White House Council of Economic Advisers said last month that it found “little evidence that AI will have a negative impact on the broader economy.” employment“The advisers noted that history shows that technology generally makes businesses more productive, accelerating economic growth and creating new types of jobs in unexpected ways.

They cited a study this year led by David Autor, a prominent MIT economist: It concluded that 60% of the jobs Americans had in 2018 did not even exist in 1940, having been created by technologies that emerged only later.

Job placement firm Challenger, Gray & Christmas, which tracks job cuts, said it has not yet seen much evidence of layoffs that can be attributed to labor-saving AI.

“I don’t think we’ve started to see companies say they’ve saved a lot of money or cut jobs they don’t need anymore because of this,” said Andy Challenger, who heads the firm’s sales team. “That may happen in the future, but it’s not yet realized.”

At the same time, fears that AI poses a serious threat to some job categories are not unfounded.

Consider Suumit Shah, an Indian entrepreneur who caused a stir last year by boasting that he had replaced 90% of his customer support staff with a chatbot called Lina. The move by Shah’s company, Dukaan, which helps clients build e-commerce sites, reduced the response time to a query from 1 minute and 44 seconds to “instant.” It also reduced the typical time taken to resolve issues from more than two hours to just over three minutes.

“It’s about AI’s ability to handle complex queries accurately,” Shah said via email.

The cost of providing customer support, he said, was reduced by 85%.

“Difficult? Yes. Necessary? Absolutely,” Shah posted on X.

Dukaan has expanded its use of AI to sales and analytics, and Shah says the tools are becoming more powerful.

“It’s like going from a Corolla to a Tesla,” he said. “What used to take hours now takes minutes. And the precision has reached a whole new level.”

Similarly, researchers at Harvard Business School, the German Institute for Economic Research and Imperial College Business School in London found in a study last year that job postings for writers, programmers and artists fell in the eight months after ChatGPT launched.

A 2023 study by researchers at Princeton University, the University of Pennsylvania, and New York University found that telemarketers and English and foreign language teachers held the jobs most exposed to language models similar to ChatGPT. But being exposed to AI doesn’t necessarily mean losing your job because of it. AI can also do the heavy lifting, freeing up people to pursue more creative tasks.

For example, Swedish furniture chain IKEA introduced a customer service chatbot in 2021 to handle simple queries. Instead of cutting jobs, IKEA retrained 8,500 customer service workers to handle tasks such as advising customers on interior design and handling complicated customer calls.

Chatbots can also be used to increase workers’ efficiency by complementing their work rather than eliminating it. A study by Stanford University’s Erik Brynjolfsson and MIT’s Danielle Li and Lindsey Raymond tracked 5,200 customer service agents at a Fortune 500 company who used an AI-based generative assistant. The AI ​​tool offered valuable suggestions for handling customers and also provided links to relevant internal documents.

The study found that those who used the chatbot were 14% more productive than their colleagues who didn’t. They took more calls and completed them faster. The biggest productivity gains (34%) were seen among less experienced and less skilled workers.

At an Alorica call center in Albuquerque, New Mexico, a customer service representative had been struggling to access the information she needed to answer calls quickly. After Alorica trained her to use AI tools, her “handle time” — the time it takes to resolve customer calls — dropped over four months from an average of 14 minutes per call to just over seven minutes.

Over a six-month period, AI tools helped a group of 850 Alorica representatives reduce their average handling time to six minutes, down from eight minutes. They can now handle 10 calls per hour instead of eight—that’s 16 additional calls in an eight-hour workday.

Alorica agents can use AI tools to quickly access information about customers who call — to check their order history, for example, or determine whether they had called before and hung up out of frustration.

Suppose, said Mike Clifton, co-CEO of Alorica, a customer complains that they received the wrong product. The agent can “hit replace and the product will be available tomorrow,” he said. “‘Is there anything else I can help you with? No?’ Click. Done. In thirty seconds, you’re in and out.”

Now the company is beginning to use its real-time voice language translation tool, which allows customers and Alorica agents to speak and hear each other in their own languages.

“It allows (Alorica representatives) to handle every call they receive,” said René Paiz, vice president of customer service“I don’t have to outsource” just to find someone who speaks a specific language.

Alorica isn’t cutting jobs, though. It’s still looking for new employees, more and more people who are comfortable with new technologies.

“We’re still actively hiring,” Paiz says. “We have a lot of work to do.”