Smart Federal Investments Are Needed for Artificial Intelligence to Improve Work, Lives, and the Economy for All Americans

Even before the COVID-19 pandemic slowed our economy and tens of millions of Americans found themselves out of work through no fault of their own, many workers already had trouble finding stable, well-paying jobs. Now, as temporary layoffs become permanent and many companies turn to automation while the coronavirus keeps workers at home, workers could face additional barriers even after the virus is contained.

That’s why at a recent hearing, House Budget Democrats heard testimony from expert witnesses and discussed artificial intelligence (AI) technology; its potential opportunities and challenges; its likely effects on the economy, labor markets, and income inequality; and what federal policies and investments are needed to help ensure all Americans benefit.

“Artificial intelligence is one of the transformative technologies of our time and likely to have major ramifications for the workforce and the economy.” — Dr. Darrell West, Vice President and Director of Governance Studies at the Brookings Institution

As Chairman Yarmuth said in his opening remarks:

“As we look to the future, AI has significant potential to disrupt the world. It presents opportunities to improve lives, livelihoods, productivity, and equality. However, it also poses serious risks of large-scale economic changes.”

AI Has the Potential to Change the Way We Work and Live for the Better

If developed and implemented correctly, AI could improve public health, accelerate our nation’s economic recovery, advance societal progress, and improve standards of living for all Americans. AI is seen by economists as a broadly transformative “general purpose technology” with pervasive uses across industries, analogous to the steam engine, electrification, the internal combustion engine, and computing. AI will likely revolutionize the economy.

“[AI can] make services cheaper to provide, higher quality, more tailored to the individual need, and substantially more accessible and convenient.”Dr. Susan Athey, Economics of Technology Professor at Stanford Graduate School of Business and Associate Director of the Stanford Institute for Human-Centered Artificial Intelligence

AI-enabled applications are already being developed in areas as diverse as health care (including medical imaging and drug development), autonomous vehicles, supply chain management, personalized learning, legal analysis, financial fraud detection, precision agriculture, energy, climate informatics, national security, and scientific discovery.

AI Can Help Fight the Coronavirus, but it is also Accelerating Job Losses to Automation

AI is helping us understand, treat, and recover from the coronavirus. It is also assisting in:

· Vaccine and treatment development

· Patient screening

· Outbreak detection

By helping us crush the virus more effectively and efficiently, AI technologies could help speed up our nation’s economic recovery.

However, the pandemic is increasing private-sector adoption of AI-enabled automation that displaces jobs. Approximately 75 percent of large companies in one survey said that, in response to the pandemic, they are accelerating automation or considering plans to do so. Without thoughtful implementation of the technology and forethought for the needs and well-being of workers, this could have a potentially devastating impact on our workforce.

Although automation can reduce the risk of coronavirus transmission while businesses continue to operate, it also raises the risks of permanent job losses, a jobless recovery, and stagnant or reduced earnings for the typical worker.

Since the pandemic started, 8.7 percent of easily automatable jobs have been lost through August 2020, compared to 4.4 percent of less automatable jobs. Moreover, automatable job losses were 5.1 percentage points higher for minority workers than for non-Hispanic whites.

“The COVID-19 pandemic will also contribute to this predicament [of excessive automation] as there are now more reasons for employers to look for ways of substituting machines for workers.” Dr. Daron Acemoglu, Institute Professor of Economics at the Massachusetts Institute of Technology

Most Jobs Will Require New Skills, and a Decline in Middle-Income Jobs Could Exacerbate Inequality

Trends in automation, especially since the 1990s, have led to: middle-income job losses, stagnating real wages for most Americans, and a huge increase in inequality.

Between 5 percent and 25 percent of jobs are at high risk for full replacement by AI. These include jobs centered on routine physical and data processing tasks that can be easily automated, in sectors like manufacturing, accounting, transportation, retailing, and food services.

Since 40 percent more women than men work in occupations at high risk for automation, and because Black and Latino Americans are over-represented in occupations at high risk for automation, these groups are disproportionally at risk of job and wage losses — exacerbating the large and persistent gender and racial income gaps that already exist.

These jobs losses may or may not be counterbalanced by the creation of new jobs, which are likely to have higher skill requirements. That’s why it’s so important that the federal government invest in education, training, and expanding opportunities to help all workers adapt to the changing economy and job market.

“The pandemic and economic crisis have already shown that income security and related programs are crucial for supporting Americans during challenging times. The shifting job landscape expected with widespread AI implementation further demonstrates this need. This will require strong federal investments in social programs, in affordable health care, child care, and housing, as well as new approaches for retraining and upskilling our workforce.” — Chairman John Yarmuth

Further, as AI applications emerge in employment, housing, health care, financial services, and criminal justice, more accountability, transparency, and intentional focus on finding solutions to ethical AI issues like bias, privacy, and reliability will be necessary.

For example, using AI tools in the hiring process to screen resumes and applications can reproduce and even exacerbate human biases and discrimination contained in the underlying datasets, often to the detriment of people of color. Productivity monitoring of employees can help improve worker safety and regulatory compliance but raise both privacy and bias concerns.

“As AI is adopted through government and the economy, it will be important for governments to keep a close eye on the myriad challenges raised by AI.” — Dr. Susan Athey, Economics of Technology Professor at Stanford Graduate School of Business and Associate Director of the Stanford Institute for Human-Centered Artificial Intelligence

We Need Federal Action and Investment to Ensure AI’s Benefits Are Inclusive and Widely Shared

A bright future of technological advances and broad societal benefits is not guaranteed. The United States must invest in AI innovation that not only increases our competitive lead in AI, but also builds technologies that support, rather than displace, workers and human capabilities. A federally led research agenda should include the development of complementary AI systems that improve human abilities and well-being through better education, better health care, and increased productivity.

Dr. Jason Matheny, Founding Director of Georgetown University’s Center for Security and Emerging Technology and Commissioner on the National Security Commission on AI, said U.S. innovation and leadership in AI should be strengthened by expanding:

1. AI research, testing, and evaluation infrastructure

2. Immigration pathways to permanent residency for scientists, engineers, and entrepreneurs

3. Research and protections for the leading-edge microelectronics technologies that are used to power AI applications

The federal government will need to take a leading role in funding and implementing new policies and programs to ensure the benefits of AI reach all Americans while supporting displaced workers. R&D, digital infrastructure, education and training, and income and social support programs all call for increased investment.


The world is changing rapidly. As we seek to recover and revitalize the economy in the aftermath of the pandemic, the federal government must make smart investments to harness AI’s potential. This will help to create inclusive economic growth, generate broad societal benefit, and improve standards of living for all Americans. If we fail to plan ahead, the underlying problems illuminated by the pandemic and recession will continue to create barriers to success for American workers.

Fighting for budget priorities that reflect the values of families across the country.