Federal Reserve Governor Christopher Waller said on Tuesday he doesn’t expect the adoption of artificial intelligence technology to totally upend the job market in the U.S.
‘I’m not a doom and gloomer” about AI’s economic impact, Waller said in a virtual appearance at a Federal Reserve Bank of Boston conference. “I don’t think you’re ever going to take the humans out of the picture and AI is going to do everything and we’re going to be left working the drive-through window at McDonald’s,” he said.
For the U.S. economy and those who are part of it, AI is “a tool we can use. We’ll use it. We’ll control it, we’ll manage the risk. That’s what we always do,” Waller said.
The implications of AI for workers may be “unsettling,” Waller said, while adding “at the end of the day, people will figure out how to take this tool and harness it to make our lives better, more productive and more efficient, we’ll have more time to do other things.”
Waller’s upbeat view on AI squares up against widespread fears that the technology will make a huge array of what were once well-paid jobs obsolete. Some of those anxieties are being fueled by those in the industry themselves, as massive investment is being poured into the sector amid a very uncertain future.
AI-related job anxieties have been further fueled by a softening in the job market, although analysts continue to debate how much if any of that weakening is related to AI adoption.
Waller also said in his appearance that the Fed is carefully moving to adopt artificial intelligence technology in a system-wide approach.
“We cannot approach AI casually,” and “as a central bank, we hold ourselves to a high standard” when using it, Waller said.
“That means clear guardrails on how and where it’s used, strong information-security controls, rigorous model validation, human accountability for decisions, and ongoing evaluation as the technology evolves,” with innovation and risk management standing together as complementary priorities, he said.
Waller did not comment on the economic and monetary policy outlook in his remarks.
He also said that despite the Fed being a highly decentralized organization, it is taking a more unified approach to implementing AI technology.
“We’re moving as one system, with shared direction and alignment,” Waller said. And in terms of deciding where to deploy the technology, “we start with the problem to be solved and the business need, then apply the right capability” from the suite of available AI technology.
Waller noted that the more centralized approach to AI comes amid a broader push to align activities at the 12 quasi-private regional banks with the goals of the Federal Reserve system as a whole.
The days of the regional banks operating almost completely independently are “gone,” Waller said. He noted the regional banks are themselves performing activities that are national in scope, which means “we have to think about this system first and get away from bank-by-bank decision making,” he said.
(Reporting by Michael S. Derby; Editing by Chizu Nomiyama and Andrea Ricci )
