Forecasting Workplace Effects of Generative AI | ETF Trends

Generative AI burst onto the scene in earnest this year. While it served as an overt catalyst for growth stocks, concerns emerged about the effects on the workforce.

Given its applications, there’s speculation that generative AI could be a threat to mid- and lower level white-collar roles. Currently, there is debate regarding what impact, positive or negative, generative AI will have on the future of work, but it’s not arguable that exchange traded funds such as the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM) will be at the center of the related investment discussion.

Both Invesco ETFs benefited from the run-up by AI stocks earlier this year. This may confirm that as the technology evolves and improves, QQQ/QQQM components will remain heartbeats of AI progress. That implies plenty of the ETFs’ holdings could have indelible impacts on the future of work.

Productivity, Workforce Intersection

AI experts and market observers currently monitor, particularly, the issue of elevated productivity within the human workforce.

“They are very closely connected to each other. So one of the key things about generative A.I is it could make lots of types of processes, lots of types of jobs, things that are very knowledge base intensive. You could do the same amount of work with fewer people or, and I think this is an important thing to keep in mind, you could do lots more work with the same number of people,” noted Morgan Stanley Global Chief Economist Seth Carpenter.

Numerous companies find increased productivity alluring. A variety of QQQ/QQQM holdings, among others, have long fostered the concept. The potentially positive news is that increased productivity vis a vis AI doesn’t necessarily mean job attrition.

In fact, it could mean just the opposite. Higher levels of productivity often correspond with bullishness in the broader economy. That could be an indication that QQQ and QQQM could benefit from generative AI advancements on multiple fronts.

“If productivity goes up, what that means is we should see faster growth in the economy than we’re used to seeing and I think that means things like GDP should be growing faster and that should have implications for equities,” concluded Carpenter. “In addition, because more can get done with the same inputs, we should see some of the inflationary pressures that we’re seeing now dissipate even more quickly. And what does that mean? Well, that means that at least in the short run, the central bank, the Fed in the U.S., can allow the economy to run a little bit hotter than you would have thought otherwise, because the inflationary pressures aren’t there after all.”

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