The idea in a nutshell : The descent of Australia’s nickle price happened not over night but over a period of many years. When Clive Palmer’s mine became uneconomical (costs were higher than profit because the price of nickel had fallen) the miners were put out of work. The cost of Artificial Intelligence projects may follow a similar pattern. Over time, AI projects will get cheaper. At some point, the project will be cheaper than workers in your office and some of those workers will be replaced. The miners claimed shock when it happened to them. Will we be shocked when it happens to us ?
Clive Plamer = face palmer
Clive Palmer is, in my view, Australia’s Donald Trump. I don’t think any reasonable person in Australia felt anything but empathy for the people displaced from his nickel mine a few months ago. The matter still has to be reviewed but it’s possible that some people including Mr. Palmer will have to defend their behaviour and spending in court.
Some aspects of what occurred prior to Mr. Palmer closing Queensland Nickel (or the associated companies, it’s all a bit complex organisationally and when figuring out where the money came from / went) were a bit murky. But there appears to be an important relationship which has not been thoroughly covered in the press surrounding the story.
The price of nickel has fallen steadily for a long time
A quick review of the price of Nickel over the last few years shows the nature of the problem I’m talking about. Those numbers – the price of nickel – are not murky at all. Palmer’s mine did not close over night. The circumstances became more and more clearly uneconomical for the nickel mining companies involved. The price of nickel has been falling for some time as the graph below ( covering roughly the last 5 years ) shows.
But Palmer’s employees are shocked
Queensland Nickel employees were upset about the closure of the company which, again, I think any reasonable person would understand. Confronted, as they were with a boss who told them one thing and did another and who is , at the very least, accused of spending money which could have been used to make whole their redundancy payments, who wouldn’t feel unjustly treated ?
From a purely economic point of view, however, the challenge to viability of the business appears to have been impending for some time.
In some ways, this is a model for what will happen when the bots come
As I have covered in other articles, bots look set to take over the world pretty shortly. They’re the first in an ever accelerating wave of AI solutions which are going to affect jobs and shock the whole economy. In some ways, these miners could be a glimpse of things to come.
I believe it’s possible to show empathy for the miners involved and still treat this as a cautionary tail.
These miners lived in a relatively cheap part of the country and enjoyed wages which were multiples of the national average. They rode the mining gravy train until the gravy train stopped and then asked the government to take care of them. Did they have a responsibility to be aware of their circumstances in the changing technological environment ? Perhaps they did and perhaps they didn’t.
However, if, reading this, you question how applicable this cautionary tale is to you and your role, I think the same. Have we each seriously considered our own position and our own industry with the arrival of AI and bots set to perform out jobs at a lower cost? Or are we like the employees of the Queensland Nickel company ? Has each of us taken the time to understand the structural changes our jobs will face from AI ? Can we honestly say, when the redundancies come, that we didn’t have time (and other resources) to retrain ?
The cost of AI projects is likely to start (relatively) high and, over time, get cheaper. At some point, AI / bots might be able to perform your job cheaper than you. Have you taken the steps you need to to insure your circumstance ?
There’s a lot going on here. To focus on AI as a threat requires a number of things that a lot of people don’t have. To effectively track what’s happening in such a dynamic situation, one needs an inclination towards finding technology and its evolution interesting. You need the time to set up tracking on AI news and to systematically review, record and synthesize the results. You need to prioritize these activities above other, perhaps more pressing (if potentially less important) considerations – like dropping the kids at football.
Technology has generally been a positive force for most of us. We enjoy cleaner, happier, healthier, longer lives because of it. We are sympathetic to the point of handing money over (i.e, we have real empathy for those affected, we don’t just pay lip service to them) when people in the car industry or mining industry are displaced. But simply because it has usually helped most of us doesn’t mean it will continue to. There have also been large parts of the workforce displaced or negatively affected by technology in the past.
I, for one, am planning for a world in which my wife and I remain employed when the job market is affected by AI. I applied for the job as I have at a bank for a number of reasons. It’s a great company. I love the brand. My boss is one of the kindest people I’ve ever met. I love the detail of the role they’ve given me. And, through the role, my responsibilities include strategizing about Digitial (which I love anyway) and prototyping innovative ideas.
AI at the moment is ‘narrow’ and there is no defined path to ‘general’ AI. Some of the jobs that will remain in an AI world are those which involve intuitive innovation. I feel lucky to be working in that area. And luckily, my wife is in Business Development and people love her. That job should be around for some time too. Phew.
I hope others are thinking in similar terms.