AI will destroy the Australian labour market


Yesterday, a reader plugged my latest philosophical musings about the Aussie political economy into ChatGPT, and the result was terrifying:

How do the concepts of “silos of information” and the “medium is message” interrelate?

The concepts of “silos of information” and “the medium is the message” interrelate in the way that the medium of the Internet—its structure, algorithms, and interfaces—shapes the message by influencing the distribution and reception of information, thus fostering the creation of information silos.

Here’s how they connect:

  1. Medium Characteristics Lead to Silos: The design of the Internet as a medium, particularly in social media platforms and personalized content feeds, encourages the creation of silos. Features like personalized search results and algorithmically-curated newsfeeds are intrinsic to the medium and lead users to engage with content that the medium’s algorithms predict will be most relevant or engaging to them.
  2. Medium Influences Behavior: McLuhan’s idea that the medium influences behavior can be seen in how Internet users become accustomed to, and comfortable within, their information silos. The medium of the Internet provides a user experience that can lead to passive consumption of information, making users less likely to seek out content that challenges their existing beliefs.
  3. Content vs. Context: While the content within silos can vary widely, the medium’s message—that is, the context and the way the content is delivered and consumed—is consistent. It promotes a customized experience that can inadvertently narrow the diversity of information to which users are exposed.
  4. Feedback Loops: The medium of the Internet creates feedback loops where user engagement reinforces the content that the algorithms show, which in turn influences user behavior and thought patterns. This reciprocal relationship is a direct illustration of the medium shaping the message.
  5. Medium Facilitates Echo Chambers: The Internet as a medium does not merely transmit content neutrally; it actively shapes content through its architecture. By allowing for the easy formation of like-minded communities and personalized content streams, the medium itself is a key factor in the creation of echo chambers.
  6. Medium’s Role in Perception: McLuhan’s concept also implies that the medium affects how we perceive the world. The compartmentalization of information on the Internet can lead to a fragmented perception of reality, where different groups have different understandings of the world, based on the siloed information they receive.

In summary, the Internet as a medium does not just passively carry content; it actively shapes the flow and form of information, which leads to the creation of information silos. These silos, in turn, are a testament to McLuhan’s assertion that the nature of a medium embeds itself in the message, influencing not just what is communicated, but how people think and behave.’

This is a better reading of my intent than my intent!

It is easy to surmise, therefore, that it is a more accurate reading of my thoughts than any and all humans are capable of.


Sure, I was still required to identify the pattern and give it a frame of reference, but how long before AI moves from spectacular static intelligence to actively insightful intelligence?

All I did was apply a form of pattern identification to political trends. AI can do that soon enough.

That means that AI will not only consume all basic informational functions within the services economy but will soon move deep into the white-collar professions.


All of them – law, medicine, education, financial advice, etc – are various forms of informational management and pattern detection.

Such a revolution will gut the Australian middle class.

Given AI can’t wield a hammer, blue-collar workers will be better off. So long as they don’t work in transport where the robots are coming.

But blue-collar workers hang on the immigration economy, by and large. Is it possible to persist with mass immigration amid a structural employment shock that erases all entry-level and transport positions?


Where will the low-skilled migrants work?

I am not typically a Luddite, but it is easy to see how this can lead to an economic disaster in Australia.

We are low-tech, services-heavy, and low-skilled migrant dependent.

This labour market profile is a sitting duck for AI.

I do not think that we should ban AI at this juncture. Its productivity potential is incredible, which will deliver a substantial economic dividend.


But it will need to be regulated, or it will destroy the Australian labour market as we know it.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.