AI is coming for the professional-managerial class

In his 1941 book, The Managerial Revolution, James Burnham predicted that a class of managers and administrators would rise above people performing actual tasks. Later dubbed the “professional–managerial class” by John and Barabara Ehrenreich, no one could have predicted that a vast swath of the upper middle class would become administrators, project managers, program managers, compliance officers, and the like.

The growth of managers and administrators

From hospitals to schools to companies, there are more managers and administrators than individual contributors working on what the organization actually creates. Thirty years ago, if you walked into a three-doctor physician’s practice, one receptionist would be at the desk. Now, an army of schedulers, insurance submitters, transcribers, and other paperwork managers serve the three doctors.

What do managers and administrators do all day?

These college-educated professionals make presentations, checklists, align, strategize, check off checklists, align, strategize, budget, summarize, and extrapolate. Most everything that they do can be replaced by the new generation of AI chatbots that are just now rolling out into organizations.

Love him or hate him, Elon Musk showed that Twitter could carry on without 80% of its former staff. People predicted that Twitter would collapse, and it did have a few minor outages. However, we must consider that a lot of staff also increases complexity and communications overload. While Twitter kept humming along, all of the airplanes in the U.S. were grounded due to a faulty computer update at the well-staffed Federal Aviation Administration, and all stock trading was halted due to a computer glitch at the well-staffed New York Stock Exchange.

AI can easily manage and administrate because of the work’s predictable behavior

Goldman Sachs predicts that 300 million jobs will be lost to AI automation, none of which are bricklayers. The new generation of AI can replace people with “know-how” that is predictable and consensus-driven. Everything from administrative staff, marketing copy, paralegal, data science, and even computer programming can be replaced with AI. Ironically, computers are among the first thing computer AI can replace.

Now medicine and other skills are still important. You need a doctor to ask the right prompts of the AI using the right terms. And you need the doctor to see if the AI comes up with something stupid. Regulators will ensure that doctors are still around, and patients will be relieved that they no longer have a human scanning their brain when presented with a list of symptoms. But you do not need that entire office full of people anymore or that entire building full of hospital chain administrators. Doximity has already shipped the AI that can replace these jobs.

In the developing world, they will not build up these administrative jobs, just like they skipped landlines and went straight to mobile. In areas without doctors, AI will be far better than nothing.

Whatfor the “surplus elites”?

During COVID, the essential workers keeping the world running and delivering food often wondered what these non-essential people were working on from home. These college-education “surplus elites” will switch from waiting in line to get into the Centurion lounge to… something new. But worry not, we have had large-scale job transitions before.

Back in 2015, I suggested that we will transition to a “village” lifestyle of working a Keynesian fifteen hours a week on jobs that entertain us, like the many college graduates we know that are now pilates instructors or gluten-free bakers. On the other hand, we all can be put to work installing solar panels and other green energy projects. That’s what we told the working class when their jobs were transitioned by globalization, amirite?

Line of surplus elites waiting to get into the Las Vegas airport American Express Centurion Lounge

PS: Yes, I wrote this myself. 😃