AI and why billionaires want your kids to become plumbers

There may be more than meets the eye when a tech leader calls for young people to go into the trades instead of university.

Recently, one of the American tech multi-billionaires suggested that young people learn trades such as electrical or plumbing rather than go to university.

He said it’s the best way to prepare for the brave new world we’re rushing headlong into, a world ruled by the equally cheered and equally feared Artificial Intelligence.

It is mighty decent of the billionaire to care about the young in the scary world he’s helping to foist upon us. Many are quite taken by his advice.

But such advice is actually not very surprising. A licensed tradesperson can earn a pretty decent living in the developed West. However, context matters. The trades pay well there because there’s a chronic shortage of people who ply those trades.

For decades, young people in Malaysia preferred to enter university and then find salaried jobs in tech or finance or healthcare or even the government.

Unclogging toilets or rewiring old houses is hard, dirty, dangerous and certainly not very popular – with many seeing the trades as poor alternatives for those who couldn’t excel academically.

Things have changed.

Many university graduates are now unemployed, either because those jobs for which they were educated have disappeared, or because the quality of their education is not relevant or up to par.

Of those who do get jobs, many of the old-time favourites – engineering, accounting, etc – don’t seem to pay very well or offer good prospects compared to the past.

And that’s before factoring in the burden brought about by the escalating cost of education, whether through student loans or the sacrifices their parents have made to put them through university.

In the age where AI seems to be taking over everything, the trades now appear more attractive. After all, AI hasn’t figured out how to fix sewage pipes or strip old wiring from houses – not yet anyway.

Governments, too, are banging on about vocational education, putting money and focus into areas such as TVET – technical and vocational education and training – that they used to downplay in favour of bright shiny universities.

Having more options for our young people is certainly good. But is becoming a tradesperson really what the future is about?

Let’s look at some counterpoints.

Many trades in the West are tightly protected by unions and codes and regulations. Supply of such tradespeople is often limited, perhaps even deliberately so, through these protectionist barriers.

So, the prospects of earning a good living are good as the trades are highly regulated and perennially short of workers. But there’s no guarantee they’ll remain that way for long.

The population of most Western countries is shrinking. Japan, and recently China, are no longer capable of even replenishing their populations. It’s the same with much of the developed world.

A shrinking population means a smaller market for the trades. When the supply of tradespeople exceeds the reduced demand, price goes down. You can’t count on the money spigot always being open for a comfortable life-long livelihood any more.

The assumptions behind encouraging this “go into the trades” advice is that people will always have homes and offices and factories for which electricity and toilets are needed, as well as the many other skills that manual labour can produce that universities don’t.

This also assumes emerging markets like Malaysia and her peers would follow the same economic developmental path, and that there’ll be a growing middle class who’ll need the services of such jobs. This scenario is no longer guaranteed.

The investment in AI – estimated at over half a trillion dollars in the US alone over the coming few years – is meant precisely to upend that scenario.

The US is seeing escalating job losses in many areas. Some are due to the longstanding hollowing out of American jobs to cheaper countries, the inevitability of which Donald Trump’s trade tariffs and economic protectionist walls won’t be able to stop.

But job losses are happening even in the sectors which are doing well. The huge investment banks of Wall Street are all declaring record revenues and profits while also announcing big job cuts driven principally by AI and (not to put too fine a point on it) greed.

AI gold rush

The bad news is most of these investment banking bull runs are driven by the latest gold rush – investments in AI. Much of the money is circulating among the few favoured AI tech firms, as well as their investment banking enablers.

That money isn’t coming down to the “regular” economy that you and I live in. In all likelihood, most of us are going to be roadkill in the intense AI battles between China and the US.

Unlike other industries and innovations, AI won’t be a net creator of jobs, and hence wealth, for most of society. Instead, it’ll do the opposite – make the rich even richer, and destroy countless livelihoods with increasingly smart and scary AI and robotic techs.

By some estimates, the current GDP of the United States is at most flattish when you strip out the AI investments, such as the chip purchases, the mega-mergers and the huge, power-hungry data centres.

The data centres, some as big as small towns, require obscene amounts of power and water to run, hence spurring other investments in these areas. But they won’t create many jobs – just enough people to keep the lights on and the toilets flushing.

This advice about taking on trade skills came from Jensen Huang, the CEO of Nvidia, the wealthiest company in the world. He is personally worth over US$120 billion, whilst Nvidia itself is worth over US$4 trillion.

I can’t help but feel that he’s more interested in ensuring there are enough electricians and plumbers to maintain the many data centres his products are powering rather than offering to help society survive the onslaught his products are unleashing.

It feels very much like he’s somebody who buys over and retires the city buses, and then asks us the city residents to walk instead as it’s “good for us”, all the while planning to soon fence off the roads and charge us for walking on them.

Many are predicting the AI bubble itself will burst soon, the way previous tech bubbles had spectacularly burst. That looks increasingly likely by the day.

All the billions spent on chasing after the AI ambitions, with hardly any revenue generated and an increasingly fragile global economic environment, is guaranteeing that inevitability. Perhaps the crash will help to knock some sense back into people’s heads, at least until the next shiny new thing gets them excited again.

But make no mistake. While the speculative AI bubble will surely burst, AI itself is on an unstoppable tear through our lives, with results which are difficult to predict.

Once the AI genie is out of the bottle, there’s no putting it back in. Until and unless society finds an answer on how to protect its members from the onslaught of this technology in the hands of the few increasingly rich and powerful tech titans – and the politicians whom they can easily buy – we should all remain very concerned.

It’s literally one of the biggest challenges facing humanity, which is how to protect ourselves from the economic calamity that these billionaires – nay deci-billionaires, centi-billionaires or even…gasp… trillionaires are unleashing on us.

In the meantime, take the advice from these prophets of technology – that our children and grandchildren should train to wire up houses or fix toilets – with a huge grain of salt. - FMT

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.