The handwriting’s on the wall, reinvent or be destroyed by AI

Carl Benedikt Frey, The 1970s Gave Us Industrial Decline. A.I. Could Bring Something Worse. NYTimes, Aug. 19, 2025.

A silent recession has arrived for recent college graduates. Over the past two years, unemployment among 22‑to-27‑year‑olds with bachelor’s degrees has climbed to levels seen during economic downturns. A college diploma used to be an ironclad job guarantee. Today it seems more like a lottery ticket with shrinking odds.

This plunge is just the beginning. As generative artificial intelligence improves, entry-level and service sector jobs may increasingly disappear, threatening not just workers but also the cities where they live. [... In San Jose, a striking 43 percent of workers could see A.I. transform half or more of their tasks.

There’s little evidence that A.I. has already begun taking jobs en masse. But just as manufacturing towns in the 1960s failed to recognize the looming threat of new technology, today’s leading service hubs risk underestimating the disruption of A.I. — especially as Silicon Valley races to automate white-collar work. As the history of deindustrialization teaches us, spotting early warning signs is crucial to adaptation and survival. [...]

A silent recession has arrived for recent college graduates. Over the past two years, unemployment among 22‑to-27‑year‑olds with bachelor’s degrees has climbed to levels seen during economic downturns. A college diploma used to be an ironclad job guarantee. Today it seems more like a lottery ticket with shrinking odds.

This plunge is just the beginning. As generative artificial intelligence improves, entry-level and service sector jobs may increasingly disappear, threatening not just workers but also the cities where they live. Recent research by the Brookings Institution shows how San Francisco and San Jose, Calif., New York and Washington could soon face significant job disruption, thanks to the rise of A.I. In San Jose, a striking 43 percent of workers could see A.I. transform half or more of their tasks.

There’s little evidence that A.I. has already begun taking jobs en masse. But just as manufacturing towns in the 1960s failed to recognize the looming threat of new technology, today’s leading service hubs risk underestimating the disruption of A.I. — especially as Silicon Valley races to automate white-collar work. As the history of deindustrialization teaches us, spotting early warning signs is crucial to adaptation and survival.

Reinvention:

Deindustrialization’s lesson is not that decline is inevitable, but that reinvention is essential. Pittsburgh and Detroit didn’t collapse overnight. They stumbled because they failed to nurture new industries — in tech and professional services — as traditional jobs vanished. Throughout the 1970s and 1980s, Detroit and Michigan poured subsidies, tax abatements and infrastructure investments into the Big Three automakers without ever halting their inevitable decline.

Boston, however, took a different path. It reinvented itself repeatedly: first in the early 1800s as a maritime center powering global trade; again in the late 1800s as a manufacturing hub fueled by immigrant labor; and in the late 1900s as a center of the tech economy and finance. Each leap depended on young talent and innovation, making education the engine of Boston’s repeated renewal. [...]

Innovation sprouts in environments that cultivate in-person interaction and experimentation — activities historically nurtured by urban areas, from Renaissance Florence to the cities that make up Silicon Valley. That means that governments should invest in amenities that attract and retain talented residents: public spaces, fast and affordable transit, top-tier schools, museums and theaters.

It also means making it easier for people to move from job to job and fostering competition. [...]

If local governments don’t act, they risk repeating Pittsburgh and Detroit’s declines. Knowledge-based roles pay significantly more than traditional assembly-line jobs, so they sustain a much broader network of local services, such as restaurants, retail stores and transit. [...]

But if San Francisco, New York, Seattle and other service capitals lay the groundwork for innovation — embracing A.I. as a catalyst for new industries, rather than just as an efficiency tool — they could change their fate. Now is the time to start drafting the next chapter of urban prosperity.