Howard Marks says AI is going to have a 'terrifying' impact on employment — and it goes well past lost paychecks

In a recent blog post, renowned investor Howard Marks expressed serious concerns regarding the impending effects of artificial intelligence on the job market. He described the outlook for employment as 'terrifying,' highlighting the potential displacement of countless workers as AI technologies advance. Marks, co-founder of Oaktree Capital Management, has been sharing insights through his memos for over three decades. In his latest writing, he explored the role of AI in aiding his creative process. Prominent figures in the tech industry, including Elon Musk and OpenAI CEO Sam Altman, have suggested implementing a universal basic income to support those whose jobs may become obsolete due to AI advancements. However, Marks pointed out that financial support alone cannot replace the intrinsic value that work provides. "A job offers individuals more than just a paycheck; it gives them purpose, structure, and a sense of self-worth," he emphasized. Marks voiced his fears about a future where many may receive minimal financial assistance but lack engagement and fulfillment in their lives. The scale of AI's impact on employment is a subject of ongoing debate. A 2024 analysis by the IMF indicated that approximately 60% of jobs in developed economies could be influenced by AI, with half experiencing positive changes while the rest face challenges. Meanwhile, a recent McKinsey Global Institute report estimated that automation could take over more than half of all work hours in the United States. Concerns about the erosion of meaningful work are not limited to Marks. Tech advisor Kate O'Neill warned in a TED Talk that as we increasingly delegate decisions to AI, we risk losing the human capacity to derive meaning from our experiences. Author James Barrat noted that while a universal basic income could help people find new purpose, the transition would likely be fraught with difficulty as many navigate job losses before establishing new sources of meaning. Experts agree that as the workforce continues to evolve, future generations must cultivate skills that AI cannot easily replicate. Geoffrey Hinton, a leading figure in AI development, stated that roles involving routine intellectual tasks are particularly vulnerable to automation. He suggested that pursuing careers in fields less prone to automation, like plumbing, may be a sound strategy. OpenAI's chief economist, Ronnie Chatterji, emphasized the importance of preparing children for a rapidly changing job landscape by fostering critical thinking, emotional intelligence, and adaptability. Musk, recognizing the shifting nature of job skills, still encourages his children to pursue higher education for social engagement and broad learning opportunities, urging them to absorb knowledge across diverse fields.