What happened?

Following the unveiling of Claude 4, Anthropic CEO Dario Amodei cautioned that up to 50% of entry-level white-collar positions could vanish instantly as LLMs become adept at coding, legal drafting, and basic research. Meanwhile, data show that US job postings for "junior analyst" positions decreased by 38% year over year, despite an overall increase in job openings. In China, 70% of video game illustrator jobs have been automated by gen AI art tools. In the UK, employers are dropping degree requirements and paying a 23% premium for AI skills.

Why does this matter?

  • Labor-market inversion: For the first time since the PC boom, mid-skill office jobs are at greater risk of displacement than many blue-collar roles.
  • Policy crunch time: MAGA lawmakers support the rapid rollout of AI to "beat China," yet the same technology threatens their working-class base. Messy coalitions around ideas like "token taxes" or European-style wage insurance schemes are likely.
  • Markets recalibrate: Following Amodei's remarks, the Nasdaq-100 jumped 0.8%, as investors anticipated increased productivity, while staffing agency bonds widened 25 bp due to default concerns.

What’s the counterpoint?

Optimists argue that past waves of automation have ultimately created more and better-paying jobs. Additionally, Apple researchers recently tested frontier models such as Claude, DeepSeek-R1, and OpenAI’s o3-mini and concluded that none of them can actually "reason." These models excel at pattern recognition, not abstraction, and they struggle with novel or logically complex prompts. Therefore, we’re likely not as close to achieving artificial general intelligence (AGI) as headlines suggest.

finformant view AI's near-term job destruction will occur more quickly than policymakers can adapt. Without reskilling initiatives and portable safety nets, political backlash will follow.
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