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Comment by zelly | Hacker News Reader

Remember (approx. 6 months ago) when we were seriously, unironically worried that all menial labor jobs would be taken by AI?

Now we're worried about all the AI jobs disappearing.

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Almost 40 percent of those in households making less than $40,000 a year had lost a job in March. Tech sector has had it easy so far.

It's going to be a bit weird because a lot of those should come back because the underlying business didn't suddenly become nonviable.

> the underlying business didn't suddenly become nonviable

They may have. We don't know when or if things will go back to the way they were before March 2020 and how consumer and employer behavior will change.

For example, maybe movie theaters are completely screwed. Except as a novelty, the big business chains may not survive. Universal Studios is already pushing back on theater release windows and no live-action movies are being filmed right now, and who knows for how long that lasts. Will the public feel safe enough to go back into theaters all at once before theaters run out of money as if nothing happened? I imagine some of those jobs at least are permanently gone.

Employers will probably maintain work from home and cut back on office space. All those jobs that support maintaining offices may not come back either.

I don't think the restaurant business will jump back either, people can't just restart their failed restaurant as if they didn't lose all that money they needed to keep their already slim margin business open before the pandemic.

Right - we saw a lot of businesses lose 80+% of their customers before any shelter in place orders were mandated. In low margin places like bars and restaurants, it's highly unlikely many can survive with even 75% of their normal level of business.

That just means prices will go up. Nothing is certain, of course, but those prices are low mostly because of high competition, not because people are unable to pay.

There will certainly be a bit of both, but it's not like you won't be able to find a restaurant after the pandemic.

Some businesses' fixed costs mean raising prices won't prevent bankruptcy.

Restaurants will remain available, but will movie theaters? They were already being disrupted by streaming services.

> Employers will probably maintain work from home and cut back on office space. All those jobs that support maintaining offices may not come back either.

I think there will be a greater demand for office real estate because suddenly everyone needs double the space and (spacious) cubicles or standalone offices will make a comeback.

That is, unless every company goes full remote.

You maintain a location with a handful of dedicated offices together with hoteling and conference rooms for people to come in a day per week or so.

It will be a long and slow ramp. I don't expect to sit inside a restaurant or go to the movies for the rest of this year, possibly most of 2021.

Theaters were on the way out before any of this started. Movie ticket sales have been declining for years. That trend will only get worse.

This makes me ponder how fortunate I am (or dumb I am) to have eaten in a restaurant twice in the past week.

It depends where you are, really. I'm in the hot zone here (northeastern US...)

> Will the public feel safe enough to go back into theaters all at once before theaters run out of money as if nothing happened?

the need for theatres and cinemas have not disappeared. They will come back once the virus situation is under control (in say 2-4 yrs time, when vaccine is available). Therefore, the jobs will come back in 2-4 yrs time.

The companies will have been different - the old incumbents will have bankrupted by then. But that doesn't matter - as long as there is new investment, new companies will spring up to soak up the demand.

Same with office spaces. It's not like the need for office space will disappear indefinitely.

>Same with office spaces. It's not like the need for office space will disappear indefinitely.

There is an arguable difference here, a lot of people were willing to WFH before the crisis, but most businesses didn't allow it. A crisis like this, forcing businesses to accept WFH, has the side benefit of doing a large experiment where business owners see whether WFH works for them, maybe even has good sides to it, but also what's negative about it.

Before, many employers were just apprehensive and would only think about this in theory. Many now see in practice what they were afraid about, and maybe they're not as afraid anymore.

So maybe office space will rebound, but maybe not. I'm quite sure in my city most office jobs are doable from home, however for meetings we might get back to some balanced level of WFH + office work. But it may never rebound to pre-crisis levels.

Things are going back to how things were in March 2020 very quickly [1] [2]

As an aside, I’ve stopped being surprised with how out of touch and in a bubble HN posts are. There’s so much understanding of human nature out there that is missing here.

1. https://www.forbes.com/sites/alexandrasternlicht/2020/05/14/...

2. https://nypost.com/2020/05/09/carnival-swamped-with-bookings...

> I’ve stopped being surprised with how out of touch and in a bubble HN posts are.

I step away from the site every few days to help stay centered.

I hope things return to normal as quickly as possible, our economy depends on it. Very few people can afford to weather this without a strong economy.

In the US when you lose your job you lose your healthcare too. Healthcare can’t be fixed in a hurry but we can all agree to be reasonable and keep as many people working as we can.

Have you watched Powell’s most recent remarks? He doesn’t seem to agree with your assessment.

These types of people predict the worst so that they are never wrong on the downside. That’s why the initial death projection was 2m people. Imagine if they instead predicted 1000 deaths.

Same stuff happens with global warming preds. You’re getting the worst case, x100, every time.

Who are "these types of people"? Fed Chairmen are usually pretty level-headed.

Do you have an academic source for the global warming claim?

Personally I'm not so sure if movie theaters are nonviable. Nerdy stuffs are generally safer.

Looking at past economic studies, there is a long run hysteresis effect after depressions and while the jobs should come back it may be on a time frame of a decade or longer.

My grandparents spending habits were permanently affected by growing up during the great depression. They talked about their frugality in the context of the depression often. It anchored their entire concept of money. My parents were deeply affected too and often talked about their own childhood and how they were taught to handle money. I feel like I was brought up with a vestige of that great depression mentality and often actively challenge myself to be less frugal. That's 90 years of long run hysteresis right there.

I doubt the consumer confidence will be the same. Not to mention that some people will be staying at home much longer.

And some people will cook more. For example, we have a lovely little neopolitan pizza joint a block away, but two days ago I received an Ooni Koda 16 and have discovered how easy it is to make my own neopolitan pizzas. That's basically a permanent reduction in my spending on pizza if/when it does reopen.

My guess is when you're tired and just want dinner now-ish, you'll learn to value that nearby restaurant. It's not like restaurants are only viable because people don't know how to cook themselves.

You can quibble about a specific food, but I think the general point stands. Habits are powerful and they can change. Every adult in the country (world?) is now forcibly learning how to cook or practicing a few new recipes. It turns out that some of those recipes are delicious, dead simple and once you know how to do it, having someone else do it for you looses it's convenience factor.

For myself:

I love cappuccino and bought several per week from cafes near me. I was missing them, so did a bit of research into home espresso and bought a nespresso and semi-automatic milk frother. My homemade cappuccino is excellent. It takes 2 minutes to make with just about zero cleanup. I have had better cappuccino, but seriously the extra time, money and hassle are no longer worth it for me. I will make it at home. It's also 6x cheaper.

I like to treat myself to steak every now and then, but only ever at a restaurant. I recently bought a package of strip steaks and did some trial and error on a George Foreman grill I found in the back of the cupboard I hadn't used in years. I figured out a process that works with that piece of equipment, and now I can knock out an amazing steak in exactly 4 minutes. It's cooked exactly how I like it. Why bother with the hassle and expense of going out for one? Plus it's 4x cheaper.

I doubt I'll completely stop going out or getting delivery, but if I reduce by 10% and everybody else does too, we're talking a lot of businesses that will close.

Supporting example: WE are making bubble teas with boba at home, takes about 10 mins and they are amazing and much cheaper and convenient than $5-6 that bubble tea places here charge.

Counter example: We basically rarely ordered delivery and preferred take-outs. However, due to the increased delivery usage recently we figured that since delivery costs are similar for a restaurant 5 miles or 15 miles out, we are getting food from restaurants further out than we would normally not go to as they were too much of a drive.

I already knew how to make coffee and cook already and I still went to to coffee houses and restaurants.

That’s like saying because I can drink at home I’m not going to bars.

Let me guess: everyone in the world is ditching Microsoft WORD for Emacs too.

I'll do you one better on the steaks. Buy a Beville Joule and a vacuum sealer. Season the steaks with salt and pepper and vacuum seal it. Heat with the sous vide to 110F for a 1" thick ribeye. 120F for a 1.5" cut. Preheat grill to 500-600F. Remove steak from water and bag, pat dry and re-season (most of the original season was absorbed into the steak). Then toss on the grill for 1-2 minutes each side depending if you like it done rarer or better cooked.

Adjust accordingly to your liking, but in general, you can easily achieve premium steakhouse quality with this approach with 30 min to 1 hour, start to finish. Mostly the sous vide as used here is about bringing the internal temperature up so that the steak cooks quickly and more evenly than a steak pulled right out of the fridge. This is even less cleanup than a foreman since the only thing getting dirty is the surface you season on (usually the paper the steak is wrapped in) and the grill you just need to brush with a wire scraper.

I recommend a VacMaster VP215, but I understand if that's way outside your budget. I personally use mine daily for lots of things besides sous vide like storing food, saving sauces

The demand is there, say for food, but the capital has evaporated and the restaurant no longer exists. To start a new one you would need investors to pay for up front costs, labor, food, and commercial rent, and who is feeling bullish enough to start a business notorious for it's razor thin margins at the start of a recession?

This kind of thing is why it's so confusing to me that more commercial landlords haven't been willing to play ball with their tenants on rent breaks through this crisis. Like, what do you have to gain by throwing out a restaurant or other business that is ready to start right back up the moment the lockdown lifts, vs sitting on an empty unit for months and months while the economy remains in turmoil, getting nothing from it. I guess it's maybe a play for some deep-pocketed franchise operator to grab it on spec? Seems risky.

I read somewhere on HN that commercial real estate is financed differently from residential real estate, and in particular, financing costs are related to what a building could earn rather than what a building does earn. If you keep rents the same but have vacancies, your funders apparently don't count that against you, while if reduce rents, suddenly the earning potential of your building has dropped and it will cost you, even if the building is actually earning more in cash flow than if it were vacant.

Seems like a bit of a misincentive here, and a recipe for lenders to go bust too. Then again, it seems like commercial real estate has periodic financial crises, so this seems to reflect reality. Get ready for the next one.

This is 100% true and this actually does affect residential as well. Many real estate investors make more money from the appreciation of the asset as opposed to current rents. Reducing rent reduces the value of the property on paper because the projected earnings over time decrease.

There's not enough downward pressure on rents in general.

Tax unoccupied space, and not a little. 10x property taxes for vacant units with real standards for what counts as occupied.

That might deter the creation of new housing supply.

Vancouver's been doing a 5x property tax for vacant units for the past few years, and it does seem to be putting some pressure on owners to get them occupied:

https://globalnews.ca/news/6523554/empty-homes-tax-results-2...

Vancouver's normal property tax rate is just 0.26%, and the vacancy surcharge is 1% per that article.

Jobs may come slowly back, but fraction of people and families will be permanently damaged in the process. People are not like rubber bands that return to where they were.

The effects can be generational when families have children.

I get that and am personally for way more support than the paltry 1200 ea that has been sent out so far. I'm just saying the loss of jobs here was artificial where every other depress/recession it's come out of systemic reactions and problems. As this goes on longer it starts to act more like a normal one though I'll admit since businesses start to fold and go under based on their fixed costs meaning the jobs are actually lost.

Meet retail

They may have. Movie theaters and night clubs for example.

People might very well use it as a reason to automate and layoff without the guilt that would have been stronger before Covid

Tech sector had it easy because it is still early and exec suite is desperately clinging to a belief this will be a V recovery rather than a slow and painful crawl down followed by the same kind of slow and painful crawl up.

These are completely unrelated. The former worry was that eventually AI would take over menial labor jobs. As you know, many AI divisions are basically in R&D right now with no tangible replacement for menial labor jobs. When a crisis hits, the jobs that are non-essential are the first to go.

the layoff includes staff at an engineering team in Padasedna, California, that works on Lidar

> Now we're worried about all the AI jobs disappearing.

I work in the space, and I'm not[1] worried about that at all. For what it's worth, anyone who knows what they're talking about also wasn't worried that all menial jobs would be taken by AI: fine motor control is really difficult, so paradoxically, janitors are safer than many middle-skilled white collar jobs are. More broadly, my model of AI is one of slow but inexorable progress: the dirty secret of tech eating the world is that most industries are run obscenely inefficiently. This doesn't suggest that Google et al can just jump into any random industry with both feet and have immediate success, but this is largely due to inertia (and in some case, regulatory barriers slowing transitions of any kind[2]), both of which are short- and medium-run concerns.

The Cruise announcement in particular is a bit of a strange one to choose to make this point:

> The layoffs represent about 8% of Cruise’s workforce. The losses were mostly in business strategy, product development, design, and recruiting. The company also dismissed staff working on Lidar engineering in Pasadena, Calif.[3]

Cruise has >2 years of runway in the bank right now[3], is a financial entity separate from GM (no longer wholly owned), and is shifting their resources away from "close to market" towards "investing in the research problem", just like other SDC companies like Waymo. The Covid downturn, like most downturns, is just a useful pretext to engage in this restructuring.

I usually tend towards taking the pessimistic view of uncertainty that affects me personally, I guess because I'm relatively risk-averse. But all the signals I've seen from the economic impact of Covid indicate that AI jobs are going to be affected by the general economic downturn but be in much _better_ relative shape than many other jobs: while shelter-in-place won't last forever, the more-lsating effects will likely include things like increased inshoring of manufacturing and an increase in demand for delivery and logistics (both central applications for robotics). The trend of people spending more time online is only increasing too, and the applications of AI there are self-explanatory from the last decade (people really do underestimate what ML specialists do: "decreasing Google's datacenter cooling costs by 40%" isn't the central AI problem most people think of, but it's the kind of things that creates massive amounts of value.

Possible longer-term trends that pose challenges for autonomous vehicle companies in particular (not AI eng in general) potentially include a) some deurbanization and b) less theoretical demand in shared transportation methods; but the latter may be somewhat mitigated by the refugees from transit to robotaxis (esp given that sharing an air pocket is so much more dangerous and hard to control than sharing surfaces).

[1] With caveats, I guess; I and most of my friends in the field have been in or adjacent to AI for a lot longer than the current boom, so we're seeing a very different picture than people who did a Tensorflow tutorial two years ago.

[2] Since I know this will be misinterpreted, I'll clarify: This isn't a suggestion that regulations are bad and should be run rough-shod over, just an acknowledgement that even good regulation tends to slow large shifts in the way industries run, just by introducing complexity and barriers to entry due to tribal knowledge of regulatory compliance. This isn't a criticism of regulation, just a well-known downside.

[3] https://electrek.co/2020/05/14/gm-cruise-lays-off-8-of-staff...

I would think that even at an AI company only a very small minority actually do AI.

It’s crazy how it creeps-everyone wants to be in AI so suddenly you have project managers with AI in their job title. I bet crisis was just a good excuse to get rid of some of that cruft.

I don't think anyone was/is really worried about either one of those. Additionally the majority of these cuts were administrative/non-engineering positions and of the cuts that were engineering most were not AI related.

Vast number of menial jobs will still be automated, and if anything, the quarantines are going to speed up the process.

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