Transformative Tech: Will AI Upend the American Workforce?

A chatbot with uncanny human-like writing abilities has become the poster child for artificial intelligence (AI) since it was released in late 2022, inspiring new levels of attention, excitement, and concern about recent advances in this life-changing technology.

As the race among tech companies to monetize AI picks up speed, it's worth considering how widespread adoption of AI-enabled technologies might affect the economic prospects of workers and businesses.

How AI changes the game

Artificial intelligence uses complex algorithms to sort through data to detect and react to patterns. This allows AI-enabled applications to "learn" from experience. As artificial intelligence has advanced and joined robots, sensors, and other technologies, many tasks have already been automated in ways that were once unimaginable. Smartphone apps map out the fastest routes from place to place and connect drivers-for-hire to people who need a ride. In some cities, driverless cars are being tested on the roads.

Generative AI is powered by large language models, deep learning algorithms trained with immense data sets to recognize, summarize, translate, and generate text. These models can create original content in response to questions posed by users, and millions of people are already using them to help write essays, articles, and business communications, code software applications, conduct scientific research, and even craft works of art such as illustrations, graphic designs, and music.

A known flaw of generative AI systems is that they sometimes "hallucinate," or make up facts when they can't find enough relevant data to inform a reasonable response. They can also perpetuate the biases of their human developers. But experts say performance can improve as software is "trained" over time.

Productivity gains and job losses

Advances in technology and automation have been displacing workers for a long time. Still, the capabilities of generative AI suggest that many more human jobs — including those for skilled professionals — could be eliminated. And the people who still have their jobs will likely be expected to use AI-enabled tools to work faster and more efficiently.

When researchers used AI-powered models to assess the potential effects of generative AI on the workforce, they concluded that 80% of human workers would have at least 10% of their tasks affected, and 19% would have more than half of their tasks affected, which puts them at greater risk of being replaced.

The long list of occupations that are most exposed to advances in AI includes many types of knowledge workers, such as postsecondary teachers, analysts, lawyers, mathematicians, accountants, human resources specialists, sales representatives, journalists, and other communications professionals.

By one estimate, generative AI could complement two-thirds of jobs by helping workers complete tasks in less time. Over the next decade, AI adoption could boost labor productivity by about 1.5% per year in the United States (to roughly double the current rate) and 1.4% globally. Productivity, or output per hour of work, indicates society's prosperity and economic well-being. A surge in productivity of this magnitude would also improve employers' profit margins and raise the world's gross domestic product by 7%, or about $7 trillion.

However, if large-scale deployment of AI forces too many displaced workers into lower-paying jobs or out of the workforce completely, it could cause a downward spiral of reduced consumer spending that stifles economic growth.

It's also possible that obsolete jobs will be replaced with different types of work, similar to the way agricultural workers shifted into manufacturing and other new industries in the past. If productivity gains bring widespread prosperity, it could raise living standards for society overall. Workers would have more free time and money to spend on leisure pursuits.

Implications for investors

AI is expected to boost productivity, cut costs, and increase profit margins. This potential is a key reason global corporate investment in AI rose from $80 billion in 2018 to nearly $190 billion in 2022, even before generative AI gained attention in 2023.

Large tech companies are investing billions to integrate AI features into existing products, such as social media platforms and search engines. Smaller start-ups are also raising venture capital to develop new business models quickly.

Successful and fast implementation of AI can provide a competitive advantage. Companies that fail to deliver could see their prospects suffer. Financial markets are likely to reward winners and penalize losers, much as they did with transformative technologies like personal computers, the internet, and smartphones.

Investors have poured money into stocks of companies expected to profit from AI. This has contributed to the recent performance surge of large tech stocks.

However, investors should remember that new technology ventures carry risk. Some AI projects may be profitable, but many others could fail. Careful research and diversification remain essential.

1. Economic Disruption and Inequality (High Likelihood, Medium–High Impact)

AI is already reshaping jobs—especially roles involving:

• Routine analysis
• Customer service
• Content generation
• Certain white-collar tasks (law, accounting, marketing)

Why this is dangerous

• Job displacement may happen faster than reskilling
• Gains may flow disproportionately to companies and highly skilled workers
• Could widen income inequality and fuel social unrest

Why it’s not catastrophic

• Historically, technology creates new jobs—but transitions can be painful
• The biggest risk is poor policy response, not AI itself

2. Misinformation and Deepfakes (High Likelihood, High Impact)

AI-generated deepfake images, audio, and video can:

• Spread political misinformation
• Damage reputations
• Enable scams and fraud
• Undermine trust in elections and institutions

Why this is especially dangerous

• Humans rely heavily on visual evidence
• Once trust erodes, even real evidence can be dismissed
• Speed and scale of misinformation exceed traditional fact-checking

This is widely seen as one of the most immediate and serious AI risks today.

3. Security and Weaponization Risks (Low Likelihood, Very High Impact)

More extreme—but taken seriously by experts—concerns include:

• AI-assisted design of chemical or biological weapons
• Autonomous weapons systems
• AI used in cyberwarfare or infrastructure attacks

Why this matters

• Low probability, but potentially catastrophic consequences
• The barrier to entry for dangerous capabilities may drop
• Bad actors could leverage AI faster than governments can respond

This is where international coordination and regulation become critical.

4. Loss of Human Control or Oversight (Low Likelihood Today, Unknown Long-Term Risk)

This includes fears about:

• AI systems acting in unpredictable ways
• Over-reliance on automated decision-making
• Systems optimized for goals that conflict with human values

These risks are more speculative, but many AI leaders believe they warrant early guardrails, not panic.

5. Why Regulation Is Being Discussed Now

As you noted, industry leaders have testified before Congress because:

• AI is advancing faster than past technologies
• Market incentives alone may not ensure safety
• Governments want to avoid repeating mistakes made with social media

Proposals include:

• Licensing advanced AI systems
• Mandatory safety testing
• A new regulatory body to monitor AI development

The challenge is acting quickly enough without stifling innovation.

6. What This Means for Workers and Society

The biggest adjustment may fall on people, not machines:

• Lifelong learning will become essential
• Careers may involve multiple reskilling cycles
• Adaptability could matter more than specialization

This isn’t entirely new—but the pace of change is.

Bottom Line

AI is not an existential threat today, but it can be dangerous if:

• Misinformation goes unchecked
• Economic disruption is poorly managed
• Powerful tools are released without safeguards

The greatest risks come not from AI itself, but from how humans choose to deploy, regulate, and adapt to it.

IMPORTANT DISCLOSURES

Broadridge Investor Communication Solutions, Inc. does not provide investment, tax, legal, or retirement advice or recommendations. The information presented here is not specific to any individual's personal circumstances.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

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