Jevons Paradox is a concept from economics that was first observed by William Stanley Jevons in the 19th century. Originally, it described the counterintuitive situation where improvements in the efficiency of using a resource lead to an increase in the overall consumption of that resource, rather than a decrease. For instance, as coal-burning technology became more efficient, the consumption of coal actually increased because it became cheaper and more accessible, rather than saving the amount of coal used.

In the context of artificial intelligence, Jevons Paradox can be applied to understand the potential impacts on employment. The paradox suggests that as AI technology improves and becomes more efficient, it might be expected to replace human labor, leading to job displacement. However, similar to the original observation with coal, the increase in efficiency and capability of AI could also lead to the creation of new jobs and industries, thus increasing overall employment opportunities rather than just replacing existing jobs.

For example, as AI automates routine and repetitive tasks, it can make these processes cheaper and more efficient. Businesses might then expand their operations or venture into new markets, which could create new roles that didn't previously exist. Additionally, AI itself requires a host of supporting roles, such as AI trainers, maintenance experts, and management positions that oversee AI operations.

However, the key concern remains about the nature and accessibility of these new jobs. There's an ongoing debate on whether the jobs created by AI advancements will be sufficient and suitable to absorb those displaced by automation. The shift could require significant re-skilling and education, as the new jobs may require different skills than those made redundant. Thus, while Jevons Paradox provides a framework to think optimistically about AI and employment, it also underscores the need for proactive measures in education and job training to prepare the workforce for these changes.

Hat tip to Dwayne Samuels for sharing a post by Groq CEO Jonathan Ross who recently spoke about this.