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‘It Wiped Me Out’
ChatGPT is already costing people their jobs and their businesses.
Here are today’s highlights:
Gene Marks thinks the battle over remote work is just getting started.
What impact will the Supreme Court’s affirmative action ruling have on hiring?
The economy has been growing faster than we thought.
But retailers are bracing for student-loan payments to start again.
The next 21 Hats Podcast episode will be published on Tuesday. The next Morning Report will be published on Wednesday. Here’s wishing everyone a terrific July 4th weekend.
It looks like ChapGPT is already starting to cost people their jobs and even their businesses: “Eric Fein ran his content-writing business for 10 years, charging $60 an hour to write everything from 150-word descriptions of bath mats to website copy for cannabis companies. The 34-year-old from Bloomingdale, Ill., built a steady business with 10 ongoing contracts, which made up half of his annual income and provided a comfortable life for his wife and 2-year-old son. But in March, Fein received a note from his largest client: His services would no longer be needed because the company would be transitioning to ChatGPT. One by one, Fein’s nine other contracts were canceled for the same reason. His entire copywriting business was gone nearly overnight.”
“‘It wiped me out,’ Fein said. He urged his clients to reconsider, warning that ChatGPT couldn’t write content with his level of creativity, technical precision and originality. He said his clients understood that, but they told him it was far cheaper to use ChatGPT than to pay him his hourly wage.”
“Now, Fein has decided to pursue a job that AI can’t do, and he has enrolled in courses to become an HVAC technician. Next year, he plans to train to become a plumber. ‘A trade is more future-proof,’ he said.”
“In March, Goldman Sachs predicted that 18 percent of work worldwide could be automated by AI, with white-collar workers such as lawyers at more risk than those in trades such as construction or maintenance.” READ MORE
Men are using AI to do better on dating apps: “Researchers at Attractiontruth, an AI dating coach, surveyed 1,371 men across the sexuality spectrum to see if they are using AI to enhance their dating profiles. The most popular dating app used by the group was Tinder, followed by Bumble and Hinge. The survey found that 20 percent of its respondents — roughly 274 men between the ages of 25 and 35 — are using AI tools like OpenAI's ChatGPT to generate bios for their dating profiles and craft ‘tailored’ and ‘captivating’ messages that ‘resonated with their preferred matches.’ Of the men who applied AI to their profiles, 37 percent reported feeling more confident with the opposite sex, and 24 percent said they noticed improvements in their messaging skills.”
“Men who responded to the survey also used AI to craft conversation starters, which they said led to ‘a remarkable boost in their response rates from their matches,’ and in turn, more interesting conversations and time saved on small talk.”
"‘Our findings highlight that users who communicated in a manner that promoted respect, honesty, and positivity had a positive impact not only on their own experience but also on the recipients of AI-crafted messages, particularly women,’ Damiata said.” READ MORE
An AI startup has been valued at $4 billion: “Inflection AI, a startup that makes a ‘kind and supportive’ chatbot called Pi, has raised $1.3 billion in one of the largest funding rounds of Silicon Valley’s current artificial intelligence frenzy. The deal values the less-than-two-year-old startup at $4 billion, according to a person familiar with the matter who asked not to be identified discussing private information. Inflection AI’s co-founders include high-profile Silicon Valley figures: Reid Hoffman, the co-founder of LinkedIn and partner at Greylock Parters, and Mustafa Suleyman, a co-founder of Google’s influential artificial intelligence lab, DeepMind.”
“The company’s chatbot Pi, which is an abbreviation of ‘personal intelligence,’ is designed to be an assistant offering ‘text and voice conversations, friendly advice, and concise information in a natural, flowing style.’” READ MORE
Gene Marks says there’s a war brewing between business owners and TWATS: “A great many employers have recognized that allowing their employees to work from home one or two days a week can be an enticing perk to offer in these times of tight labor. They understand that their workers have personal commitments, families, and dependents, and they want to help accommodate them by adopting a more flexible work schedule. And what do they get in return? More loyalty? Praise from their employees? Gratitude? Nope. Instead, they get the TWATs (shorthand for workers who are in the office only on Tuesdays, Wednesdays And Thursdays).”
“The truth is that ‘working’ from home on a Monday or a Friday isn’t really like working in the office. Because why else would those two days be so particularly popular?”
“It’s because people are using those days to extend their weekends at the expense of their employers. They think they’re pulling the wool over their bosses’ eyes. They think that they’re getting away with something.”
“But good things never last. A battle is brewing. Some employers are starting to fight the TWATs.” READ MORE
The Supreme Court’s ruling on affirmative action is expected to have an impact on hiring as well: “Now that the Supreme Court has struck down the use of race-conscious admissions at colleges and universities, conservative groups and legal experts say the private sector should get ready for more challenges to their DEI — diversity, equity and inclusion — initiatives. Though Thursday’s ruling is not expected to have direct legal implications on private-sector employment practices, it ‘will put the wind in the sails of groups like ours, who want to get the woke, racially based hiring and promotion schemes out of corporate America,’ said Will Hild, executive director of Consumers’ Research, a right-wing advocacy group that has taken aim at the use of environmental and social considerations in the finance sector.”
“‘I do believe that it will have an effect,’ Linda Chavez, the chairman of the Center for Equal Opportunity, a conservative think tank that has been pressing companies to change their diversity programs. ‘I think you will see groups like ours looking closely to ensure that employers are not giving race undue influence in decisions about whom to hire or to promote.’”
“Corporate DEI programs gained momentum in 2020 after George Floyd was murdered by a Minneapolis police officer. Companies worldwide, under public pressure to show their commitment to racial justice, spent an estimated $7.5 billion that year on the measures intended to diversify their workforces and leadership teams.”
“[Alvin] Tillery, the Northwestern professor and diversity consultant, said he will recommend that companies stop using the word ‘diversity’ and the acronym ‘DEI’ to label their initiatives. ‘We have to start calling them Title VII compliance programs,’ he said. ‘So the chief diversity officer is going to become the Title VII compliance officer. Inclusion training is going to be Title VII compliance training.’” READ MORE
Stop me if you’ve heard this one before; there are fresh indications that the economy is growing faster than expected: “Economists forecast a recession to materialize by now. Indeed, consumers, workers, and businesses have faced challenges over the past year, with interest rates rising and inflation elevated. Instead, the economy has continued to grow, even in pockets sensitive to higher interest rates. The housing market is a key example. A historically low number of existing homes for sale has helped push up sales of newly built ones. New home sales rose by double digits in May, far exceeding economists’ expectations.”
“GDP grew at a 2 percent annual rate in the first quarter, revised up from a previously reported 1.3 percent growth rate, the Commerce Department said Thursday. Stronger consumer spending was a driver behind the upward revision. Consumer spending grew at a 4.2 percent annual rate in the first quarter, the fastest pace since mid-2021, when the economy was rebounding from pandemic lockdowns.” READ MORE
But retailers are bracing for student loan payments to restart: “The end of the pandemic-era grace period is another pressure point for American households already getting pinched by inflation, high interest rates and record credit card debt. Economists say it could further cool consumer spending — long a bright spot for the U.S. economy — by redirecting billions of dollars to monthly loan payments. The timing is particularly rough on retailers, which are gearing up for the crucial holiday shopping season. The investment bank Jefferies estimates the renewed student loan payments will come to $18 billion a month, or 3 percent of the $686 billion that Americans spent on retail and food services in May, according to Census Bureau estimates.”
“Experts say department stores and specialty retailers will be the hardest hit, as consumers forgo new clothes and electronics, or trade down to big box stores and discounters. Discretionary spending of all kinds — from dining out to streaming services to travel — will also take a hit.”
“‘This is a major hit to most people’s budget,’ said Katie Thomas, who studies the retail market at the Kearney Consumer Institute think tank, ‘and the fact that it’s been paused for so long means that people have mentally taken that out of their budgets.’” READ MORE
For those of you who like to plan ahead, check out the Entrepreneurs Conference and Awards from friend of 21 Hats Ramon Ray: Held on April 18th and 19th in New York City, it will feature Seth Godin and two days of inspiration and education (and I’ll be there, too). Use the code “21hats” and you’ll get 20 percent off. LEARN MORE HERE
THE 21 HATS PODCAST
Embrace It. Leverage It. Or Die: This week, Liz Picarazzi, Sarah Segal, and Laura Zander wind up talking about artificial intelligence, concluding that the time has come for business owners to take AI seriously. Laura says she’s already experimented with using ChatGPT to create lists, to write product descriptions, and to write a marketing plan for a new product. She even used ChatGPT to prepare a presentation for her staff about how to use ChatGPT. She did this in part to reassure them that they don’t have to fear losing their jobs. “What I told the team is, ‘It's a nail gun,’” says Laura. “‘Sometimes you need to use a hammer, because it needs to be perfect, and it needs to be exact. Sometimes you just need a damn nail gun, and you just want to pop it through. And that becomes the skill. The skill becomes: When do I use the hammer and when do I use the nail gun?’”
On their way to the conversation about ChatGPT, Liz, Sarah, and Laura consider the various ways business owners can tap expertise, including through advisory boards, through business groups, and with strategic weekly lunches. Plus: Laura explains why she likes to hire people even when she doesn’t have an opening.
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Thanks for reading, everyone. — Loren