BlackRock CEO Larry Fink.AP
Larry Fink, CEO of BlackRock, believes AI will increase productivity and wages.His firm has increased assets while keeping head count the same which Fink credits to AI advances.Although AI optimists hope it’ll raise wages, others are more skeptical and fear job displacement.Larry Fink, CEO of BlackRock, said on a recent earnings call that the company’s investments in AI will drive up productivity and raise wages.
Fink said the firm had increased assets by $2.5 trillion over the last 18 months while keeping head count the same, which he credits to productivity gains from technology advances, including AI.
"We’re going to bring down inflation in America. This is how it’s going to have to be done, driven through technology, which will increase productivity," he said.
"What it also means is rising wages … the whole organization is doing more with less people as a percent of the overall organization. That is really our ambition," he added.
The $10.5 trillion asset manager is also positioning itself as a key player to power the AI revolution by becoming the capital supplier for new data centers and power generation facilities required by AI-driven companies.
At a conference last year, Fink said he was dedicating much time to thinking about how AI would reshape the firm.
"We spend a lot of time with different technologists who know much more about this than I do. They believe things like it will increase productivity by 30%," he said.
AI is already helping workers in white-collar jobs become more productive, according to studies done by economists. But this doesn’t necessarily guarantee wage gains: if productivity goes up, business owners may pocket those extra gains for themselves.
While AI optimists hope it’ll create an economic boon, others fear it will create fewer jobs and lower wages in some professions.
20% of Americans have jobs that are likely to be highly exposed to the impacts of AI, according to a White House report by the Council of Economic Advisors.
Some of those will benefit positively from AI through increased productivity and new job opportunities, while "some are harmed, typically due to job displacement," the council wrote.
Read the original article on Business Insider
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{URL}https://www.businessinsider.com/blackrock-larry-fink-ai-will-drive-up-wages-boost-productivity-2024-4{/URL}
{Author}abacon@insider.com (Alexandra Bacon){/Author}
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