(Illustration by Hugo Herrera)
The world of work is changing. AI’s impact on work and workers is an inescapable conversation right now everywhere from the World Economic Forum and the White House, to American union halls, Fortune 100 board rooms, and VC cocktail parties. AI is poised to alter everything from how customer service questions get answered to diagnosing cancer. Here we will skip the false precision of predicting exactly how many jobs will be dislocated and instead focus on how we can envision and incentivize the beneficial impacts of AI for both workers and society.
As venture investors, we are constantly hunting for big, audacious ideas that can produce outsized returns for our investors. But we also didn’t get into this industry without the fundamental belief that the future can be made better than the present. That’s not techno-utopianism but rather a recognition that there are numerous levers within capital that can shape the future we want to live in. If we choose to use them. And as the world of work is reshaped by AI, we believe there are opportunities within our critical, fast-growing care economy sector to enable and support a workforce with the biggest shortages in the United States.
AI and the Future of Work: What Stays and What Goes?
AI’s fundamental skill is pattern recognition at a staggering scale. This means that many administrative and analytical tasks like note-taking, scheduling, data reconciliation, and summarization will be reduced dramatically. It is true that jobs will be lost in these areas. But the ones that remain may become higher quality and higher paying. For example, think of a nurse manager or a teacher who no longer needs to devote 40% of their time to jockeying a schedule or designing slides and worksheets. Instead, they can lean into the uniquely human elements of their job in ways that require emotional and contextual assessment and insight that technology cannot replicate. AI will isolate and highlight these soft skills in ways that will make them more valuable and potentially higher compensated.
AI also has the potential to lower the barriers to entry to many jobs, including technical ones. We’ve seen this same scenario play out with other technological leaps forward, time and time again. Think of the way online maps and navigation made becoming a London black cab driver more accessible, no longer requiring decades to earn “The Knowledge” of every side street. Now that AI can synthesize huge volumes of information and deliver it at the moment of need—to a technician repairing a downed telephone pole, to a nurse wondering which needle gauge to use, to a young engineer who can automate her code production—the workforce will actually become more fungible.
While this sounds like bad news for workers, cheapening tenure and reducing the costs of turnover, workers are more than their technical knowledge. Soft skills, relationship building, and culture will all still matter across industries and job types. Right now we have plenty of highly qualified workers whose days are stuck doing a lot of workflows that are essential to their jobs but aren’t the best use of their training. By having AI automate some of the more time consuming and routine tasks, more experienced, long-tenured workers may benefit as they are able to “practice at the top of their license.”Moreover, a more fungible workforce can accrue significant benefits for workers too. Just-in-time training and a wealth of accrued knowledge at your fingertips no matter how long you’ve been in the job will open up the ability to change jobs, move geographically, upskill, and cross-train.
The Role of New Technology and Caregiving
While much of the alarm around AI and automation concerns the threat that these technologies will be used to replace workers—a real risk in some sectors—we are, in fact, facing acute labor shortages in some industries that have been here for years and show no sign of going away. And while we’ve seen abundant investment in tools designed to assist software developers and free up time for them to focus on the more challenging parts of their jobs, there has been far less investment in technology that could assist construction workers, the service sector, teachers, nurses, or other care workers. Many of these jobs are ripe for innovation, and responsible AI technology could bring more good than harm in assisting parts of our workforce that are stretched to the breaking point.
According to BCG, the United States will lose $290B per year by 2030 if we don’t address two critical care-economy dynamics: the extreme worker shortage in care jobs and the departure of family caregiver employees from other industries when they have to fill the care gaps created.
Some of the most interesting examples of how AI might benefit both workers and those who they serve may therefore occur in the care economy. The care economy employs 17 percent of the US workforce, an area currently experiencing one of the greatest employment shortages, including home health-care aides and nurses. At the same time, these jobs have incredibly high rates of burnout, are physically taxing, mentally exhausting, and often poorly paid. Nearly one in five home health-care aides lives in poverty.
AI and other enabling technologies can make care jobs better and more attractive as a way to increase supply—by automating tasks as opposed to the job wholesale. Take health-care worker burnout for example Things like AI-supported charting, documentation and staffing companies like Abridge, Guardoc, and In-House Health, can potentially cut that work by two-thirds. Tech can also build software for small businesses in areas like childcare, hospice care, and skilled nursing facilities to make scheduling, enrollment, and business management more efficient, potentially opening up savings for higher pay. Similar applications can reduce the time nurses spend on administrative duties, helping to relieve a critical nurse shortage.
Teachers in the United States report the highest levels of burnout of any profession in the country. Currently, about half of teachers’ time is spent not with students but on grading, lesson planning, and curriculum development, as well as other administrative tasks. Some of these tasks could be areas where generative AI technology like Brisk Teaching could serve as a useful copilot for overburdened employees.
At the same time, AI and other technologies can reduce the burden of caregiving on the 40 million Americans who are unpaid family caregivers for their loved ones. Companies like Wellthy use AI to offer customized care coordination tools and support, and companies like Carefull use advanced AI and machine learning techniques to detect fraud and enable adult children to manage the daily finances of their aging loved ones. Caregiving is equal parts work and love—and technology can help reduce the administrative work burden for families and allow more time for connection.
Looking Forward
AI and technological innovation alone will not solve the labor crisis in the care economy. A multi-sector response is required to ensure higher standards and better pay for the caregiving workforce and increased financial support for American families to enable increased access to child care and elder care.
In trying to ensure that the rapid growth of technology is something that will benefit workers and societies as much as entrepreneurs and executives, there’s a role for all of us: employers and workers, academics and governments, as well as investors committed to seeing the technology they fund be used to increase the common good.
Civil society, governments around the world and industry leaders are beginning the difficult conversations to develop regulatory frameworks that can be harmonized globally—that acknowledge the enormous promise of AI as well as its not insignificant peril if not thoughtfully deployed. Venture investors are privileged to have a front seat to those building the future of AI. It is incumbent on us to nudge the economy towards something more sustainable and more humane. This is a space where a lot of people are currently debating the right approach. The White House recently released an AI Executive Order and last year the European Union introduced their first regulatory framework via the AI Act. In November, a group of venture capital investors, the Responsible Innovation Labs, released a set of guidelines on Responsible AI Commitments and Protocol for startups and funders to follow, prioritizing issues of safety, trust, and transparency. Already, the guidelines have drawn the support of dozens of venture investors, startups, and others.
The impetus for responsible technology investment must also come from the asset owners themselves whose money is managed by the venture investors, such as major foundations, pension plans, and university endowments. Aligning investments with ethical missions is not just the right thing to do—it's good business.
As we navigate this transformative era, being deliberate about pointing the innovation engine of our economy towards technology that benefits everyone will be essential.
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Read more stories by Elana Berkowitz & Courtney Leimkuhler.