The Unspoken Rule: How AI Became the Ultimate Wage Negotiation Tactic

A recent CNBC conversation between David Kelly, Chief Global Strategist at JPMorgan Asset Management, and host Leslie Picker shed light on a harsh reality that’s been brewing beneath the surface of the US economy. With unemployment rates hovering around 4.1%, one would expect wage growth to be on an upward trajectory. Instead, stagnating wages, soaring inflation, and a growing sense of desperation among workers have become the norm.

Kelly’s candid remarks pointed out that workers are increasingly reluctant to ask for raises due to the looming threat of AI-powered replacements. This unspoken rule has become a potent tool in the hands of employers, allowing them to maintain control over the workforce while reaping the benefits of stagnant wages and rising profits. Employers use this tactic not just to boost productivity but also to exert power over workers.

The notion that workers are “afraid” to ask for raises is a masterful way of framing the issue. It implies a lack of confidence or initiative, rather than recognizing the very real fear of being replaced by a machine. In reality, workers are simply responding to economic realities. When wages stagnate and inflation rises, it’s not about being “scared” to ask for more; it’s about being pragmatic.

Wage growth was 3.1% year-over-year in August, while inflation soared at a rate of 3.4% in July. These numbers paint a picture of an economy rigged against workers. Kelly’s assertion that the current unemployment rate is “probably better than it’s been 85% of the time over the last 50 years” highlights the disconnect between economic indicators and actual worker experiences.

This phenomenon is not unique to the US, nor is it new. Low unemployment rates often coincide with stagnant wages and rising inequality. The current situation is merely an extension of this pattern, exacerbated by the growing presence of AI in the workforce. It’s as if the economy has become a game where workers are pitted against machines, with the ultimate goal being to drive down labor costs and maximize profits.

Proponents of AI often tout its ability to increase productivity and efficiency. However, this comes at a cost: the erosion of worker bargaining power and the normalization of low wages. Kelly’s comment, “you better put your head down and keep doing the work,” reinforces the notion that workers are mere cogs in a machine, rather than human beings with agency and dignity.

The implications of this trend extend far beyond individual workplaces or industries. If AI continues to be used as a tool for suppressing wages and worker rights, we risk creating a society where the only way to get ahead is through technological displacement. This dystopian vision should send shivers down the spines of anyone who cares about social justice.

As we move forward, it’s essential to recognize the unspoken rule at play here: AI has become the ultimate wage negotiation tactic. Employers use the threat of AI-powered replacements as leverage to maintain control over the workforce and keep wages in check. This strategy relies on fear, intimidation, and exploitation. But it can also be challenged.

By acknowledging this reality, we can begin to build a movement that pushes back against the status quo. We need to create spaces where workers feel empowered to demand fair wages and better working conditions without the constant threat of technological displacement looming over them. This won’t be easy; it will require us to challenge dominant narratives around AI and its role in the economy.

But if we fail to address this issue, we risk creating a future where workers are forever trapped in a cycle of low wages, rising inequality, and technological displacement. It’s a prospect that should unite us all: workers, policymakers, and business leaders alike. The time has come to take a stand against the unspoken rule and fight for a more equitable future – one where workers are valued not just for their productivity but for their humanity.