Inside the Urgent Effort to Prepare America’s Workforce for a Massive AI Disruption

[music] When I got out of the government, [music] CEOs of major US corporations started to call me saying that they were worried about massive job losses that could be coming because of AI and robotics. not one or two CEOs, but a number would call and almost as if to say, you know, you what are you going to do about that? For this episode of the CNBC Changemakers podcast, [music] I am so excited to share my interview with former commerce secretary Gina Rayondo. We talked about her plan to create jobs as AI shakes up America, why she's concerned about women falling behind, and how she wants to tackle that gender gap. Plus, her advice to anyone [music] trying to be AI proof right now. And she shared how she's figured out how to navigate tricky situations and [music] work with leaders on both sides of the aisle. Plus, she had an incredible life hack. Take a [music] listen. Thank you, Secretary Rayondo, for being here with us today on the Changemakers Podcast. Um, you've had such an incredible career driving change as governor of Rhode Island, nationally as Secretary of Commerce, and then before that, you were a lawyer, entrepreneur, and partner at a VC firm. Such an incredible career. And it strikes me that after leaving the Biden administration, you could have done anything, but you decided to devote this chapter of your life to upskilling and reskilling around AI. Why is that? When it comes to AI's impact on jobs, what do you think the worst case scenario looks like? Ah, well, first of all, thank you for having me. I'm a big fan of yours and the concept and programming of change makers. So, hats off to you for doing this and telling these stories. Um, you know, I would say I am I'm an AI optimist and I'm a I have two kids and I want them to live in an America that has the benefits of AI, you know, better health care, better technology, better data, etc. I think the worst case scenario is that we don't have a plan to make sure that every American can have a good job in the age of AI. And then the result will be the technology will move out fast. Tens of millions of Americans will be put out of work or undermployed. And in that instance, listen, I worry deeply. I think you could have a economic recession that is deep and long. I think you could have rioting in the streets. I I mean that sincerely. Um I wouldn't have said that 10 years ago, but in the past 10 years, economic inequality is through the roof and our democracy is fraying every day. So I think you'll see that uh and then I think which would be quite terrible you will see regulations in America stopping AI innovation which would which would be bad not only because it would deny Americans the technology but then China and other countries will lead the world. That's what I see as a worst case scenario which is why I've decided to devote as you say this chapter of my career um to doing it. If we just if we just let AI loose and wake up in I don't know three or four years with a 10 11% unemployment rate 20% unemployment rate among young people people in their 20s I think we're screwed it a non-technical term I think you'll have all those three things I said so let's get ahead of it so you're trying to get to the solution with your new organization raise us so with that organization. What could the best case scenario look like? Uh best case scenario is we bring employers to the table and convince them to implement AI in a way that ensures the bottom doesn't fall out, you know, overnight among tens of millions of Americans. and we get governors to the table to change policies so that we have like a planned transition. What I'm looking for is a planned transition to an AI economy. Um I I believe in some number of years AI like every other technology will create new jobs, more jobs. Uh I really do. But we need a planned transition. Otherwise, if we put our blinders on and just unleash the new technology without a plan to bring every American along, then I think you'll see what we just talked about. So, you've only been in your role running raise us for a couple months now. What brought you into this role? Did you know back when you were a secretary of commerce that you wanted to tackle this this issue of of AI and jobs? >> It's a great question. I didn't but as the commerce secretary I was also the secretary of technology and so I created when I was secretary the um America's AI safety institute and that was in the commerce department. We built a team to test models before they were released mostly around national security risk and cyber risk. Um, of course, as secretary, I was also the person that did the sanctions and export controls of AI semiconductors to say what China could and couldn't get. So, I really became a deep expert in the AI technology and chip technology. I wasn't as focused then on the jobs cuz it was so early. And here's an interesting thing, Julia, or I think interesting. When I got out of the government, CEOs of major US corporations started to call me saying that they were worried about massive job losses that could be coming because of AI and robotics. Not one or two CEOs, but a number would call and almost as if to say, you know, you what are you going to do about that? And a few of them I said, well, why are you calling me? Then they said, "Well, you know, you're the kind of person that has credibility with business, understands policy, former governor that that maybe uh could lead the charge on this." And so you know here I am uh and I'm trying to my ambition for Raz is that it is the leading organization in America thinking about these issues and but more than thinking about them like trying new things. So what are your specific goals for this organization? You were aware of what the risks were you want to be part of the solution but how are you going to do it? So, we're working with governors and companies to provide private capital. That's what we bring to the table to try new forms of career transition, supporting people from one job to another, job training, and then ultimately scaling what works. So, for example, in Maryland, we're working with the governor to have a government supported year of service for young people. >> Why? >> So, like Americanore or Teach for America. >> Yes. Only not limited to just teachers. >> Yeah. And funded by Raise Us and funded also by the state of Maryland. So, you're 20 years old. You don't know what you want to do. It's really hard to get a job because so many reasons. You join this year of service. Everyone is going to work at a local employer in Maryland. Initially, we're focusing on health care, teaching, um, you know, clinical jobs in healthcare, places they are in need. Hopefully, you do it for a year. Maybe you earn a credential or certificate and you get a full-time job at that company. So, that's one example. Uh, in Arkansas, we're working with the governor of Arkansas. We're working with bipartisan governors of all shapes and stripes and parties in Arkansas. Uh, the governor had a vision. She thinks that, you know, anyone who loses a job when they collect on go to collect unemployment insurance, right? then and there there should be a navigation tool to help set them up with an available job and help get in the community and help get them the skills, the training they need to get that available job. So that's like I said, raise us is going to bring the private capital to bear, employers in our employer coalition and working with governors to change policy levers. Um, we we'll work with another governor to do wage insurance. You know, if you're if you're a person in your late 50s, you lose a job, you might have to take a job at a lower pay, but we want to top up that pay for a period of time. So to make up the difference between your own salary and your new salary, I basically Julia, I just think, and I know this actually from being governor and running a business, America's workforce system is old. It is old-fashioned. Unemployment insurance was created a 100red years ago in the Great Depression and hasn't been changed. the college system. Think of how much money this country spends to subsidize attendance in college. Pell grants, college subsidies, college loans. College mostly doesn't work for most American students, but yet we keep shoveling money into that. It worked for the GI Bill after the Second World War. >> Hasn't been changed since. So, what do I want to do? I want to use the fact that AI is changing everything to start changing these policies so that every single American can thrive and have a place in an AI economy, one state at a time. I want to go back to what you just said about insurance and this idea of insurance for job displacement, which sounds great, but it seems like it's really contingent on quickly getting people retrained and back into the job market. How quickly can you really upskill people with AI skills or AI fluency to give them access to jobs that that they wouldn't have had access to before? So just sort of trying to wrap my head around this idea of insurance for job displacement. It's first of all it depends on the job you're trying to get right like to become physical therapist or a nurse that that takes you know many years but in some other things it could be months. It really could be months. And by the way, the exciting thing about AI is we will use AI to do a skills assessment of somebody. Gina, what what am I good at? And then use AI to deliver training to me that fits me and my style of learning um to make sure that I, you know, get the skills I need. So I in many cases it's months and other cases it's years. Uh what we're doing now for example we know we know there's certain jobs that are super vulnerable to AI call center workers um billing people uh claims assessors. If you work for an insurance company and your job is to figure out whether the medicine that the doctor prescribed is covered by your insurance. So research researchers this stuff is all vulnerable to AI. So what we're doing now is we're going to companies who have call it 5,000 call center workers and we're saying we want to work with you now proactively to assess the skills of these people ask you Mr. CEO to retrain and reabsorb some of them and then the rest of them how would you pay them for a year but yet give them half time to be trained by us to go get something else. So these are the spec really granular specific pilots. I suspect some will work. I suspect some won't. But that's why I've raised a lot of money cuz the ones that work we want to we want to scale. This seems like such a complex challenge and in many ways it seems like an impossible challenge because many of the companies funding raise us are building the technology that's replacing workers and then you also have the fact that the AI itself is is evolving so quickly that the jobs that AI might replace are changing every day and I can't even imagine what we're going to be talking about a year from now. So, how do you figure out how to re retrain employees for new jobs that don't exist yet? And you're doing this in a state-by-state basis really across every industry. Yes. By the way, it is I don't think it's impossible, but it's a monster problem. Um, but it it has to be done. In other words, somebody has to do it. Ultimately, the federal government will have to do this, but Congress isn't going to do a damn thing. Congress does nothing. You know, there's not a lot of things about which I'm confident, but I would bet you a lot of money that Congress won't pass effective bipartisan legislation helping American workers in the next three years. It's just not going to happen. So, I felt we got to try. We have to try. Ultimately, if we're successful, I hope that Congress will take action. Um, but to the other point that you said, well, how do you know what the jobs of today or tomorrow? That's what we're trying to do really is to set up new incentives for companies to do this continuous redeployment and retraining. Maybe today it's call center workers. Maybe two years from now it's something else. But we just have to kind of reset our policies of incentives of training of severance of payroll taxes, right? Like all of these systems are kind of oldfashioned and we have to get them ready for an agentic economy. You're really counting on the power of public private partnerships and on companies to get it. What is what has your dynamic been like with companies? Do you think they understand these risks of people potentially riding in the streets that you're laying out? Or are they saying, "Hey, we we, you know, see our stock go up when we cut jobs because of AI." You know, I'm smiling. It's all over the map. Some CEOs get it and some don't. So, right now, I'm I'm I'm working with people who are willing to lead. So, I'm building a coalition of the willing. We have, I think, 24 companies, 25 companies in our coalition. These are CEOs and boards that have said we we know what's coming and we want to experiment and be innovative and do the right thing. Listen, many CEOs you call say, "No, no, I'm just going to do what I always do, which is maximize short-term profit and short-term share price." And those aren't the ones in our coalition. The workforce has already been plagued by gender gaps for forever. And there are various studies that have shown that women are adopting AI in the workforce at lower levels than men are. How are you thinking about your systems um and everything you're testing to address those gaps at a time when there's a lot of concern that AI risks widening those gaps? Yes, I am deeply deeply deeply concerned that AI will have a disproportionately negative impact on women for two reasons. One, women are clustered in jobs that are clerical of nature or um administrative and that's what's going to get hit hardest. Like earlier we talked about call centers. That's those are mostly women. um people who do billing, people who do healthcare coding, those are almost all women, all AI vulnerable. And then the second reason is what you said, women tend to adopt technology just generally at a slower rate than men. So we are very consciously trying to work with employers like in the insurance industry, in the financial services industry, in the telecommunications industry that have high numbers of these kinds of jobs and like focusing our programs on these women and getting ahead of it. Like this is the thing, Julia. If you talk to a CEO who has I'm going to make it up, 10,000 call center workers, they know now that they might have 2,000 in 3 years. So, let's not wait and just lay off 8,000 people. Let's get to work right now. And like like I said before, let them work a year full-time for full pay, but let them come to us and get retrained in that year so they never have a period of unemployment. So, we're really focused on these jobs that we think are um you know that people are going to lose a job in the next 12 to 18 months. Bill Gates weighed in on this. He said he wants to see a plan to ensure the benefits of AI are acred equally. He's talked about an AI token, a robot tax, the idea of human reserved jobs, jobs that won't be assigned to robots. What do you think about his suggestions or his way of tackling this? I agree those are all worth exploring. Um I I have say I find my position to be quite similar to Bill Gates in so far as uh he's an AI optimist. He he wants America to lead in this technology. He believes in the promise of the technology uh as do I. And I think it would be honestly I think it would be terrible if we don't have a plan for the safety issues and the job issues and therefore we never get to the good stuff of AI because it, you know, it's regulated, stopped, etc. So, but I mean, look, there's no question we're going to have to look at all of those things. For example, right now, if you're an employer, you pay a payroll tax for every employee. You pay nothing for an agent. So, your incentive is to get rid of your employees, not pay that payroll tax, and use agents. We got to That's my point about changing incentives. But but he I mean you very much see the opportunity for the government to change incentives, but you're also counting on companies to provide the solutions and a call center to say, "Hey, we want to help these 8,000 people. We're going to lay off as opposed to saying it's not our problem anymore." But Bill Gates does not expect companies to provide solutions and really sees this as the role of the government or democratic institutions. How do you square his perspective that maybe companies that are, you know, part of the capitalist system aren't necessarily can't be counted on to be part of the solution? Well, like I said before, in my mind, there's no question that there's going to have to be federal government action. If you want to change the payroll tax, add a token tax, protect your group of workers, that can't be automated, that's federal legislation. The problem is today, Congress is not doing anything today. So, I'm taking action with a coalition of the willing governors of both parties, CEOs who want to be creative and lead to start doing things today to show the art of the possible. We're not waiting for Congress to do the right thing. At some point when Congress gets around to doing their job in however many years, I hope and expect they're going to look to the work of raise us. Look at that interesting year of service in Maryland. Look at that new tax incentive that the governor of Utah provided for companies to redeploy, you know, oh, look at that new wage insurance pilot in Pennsylvania and incorporate that into federal law. So, taking this back to the human level, you mentioned you have kids. What's your advice to people in the workforce right now, whether they're in their 20s trying to figure out their career or mid-career or just, you know, in their 40s or 50s and worried about being replaced by a robot. >> Yeah. I say a few things. Um, what I I'll tell you what I told my own kids, like be prepared for change. Be comfortable with change. which is hard. Like most of us are not comfortable with change. We would like a world that's pretty steady. And I tell the kids like you have to learn how to be excited by change. You might have 10 different jobs in your career. My dad had one for 30 years, you know. So get ready for change. Number two, learn as much as you can about the technology. Don't be afraid of it. You know, there's a lot of different ways to learn. And this is a thing that raise us is going to fund like you know more training for people but it's here to stay. It's could be exciting use it learn. Um and then the third thing I would say is like let your voice be heard. You're seeing that happening now with data centers. People are saying you know no if my electricity bills are going to go up. No. And I think the same thing for the rest of AI. Like if you're a parent and you're worried about AI, you know, hurting your kids, well, make your voice heard. If you're um, you know, worried about your job or your industry, I think it's what I see happening now is fear, which leads to anger, leads to outrage, not a lot of productivity. So what I'm trying to do with Raas is say let's channel the fear into action and a plan and not just anger. And just on a practical level though, um, for someone who's been in an industry for 20 years and sees that maybe their job could be automated, other than being familiar with the technology, how do you make sure you're one of the employees that companies want to keep as opposed to someone whose maybe job isn't going to be necessary anymore? Yeah, it's again a great question. I this is what we are trying to do. like if I do my job right, your company will have an incentive, an economic incentive not to lay everybody off to to invest some of the savings from AI into growth and retrain people for those growth areas. Um, and in that if that works, then your job is the same it's always been, which is to like be a terrific employee, you know, do the best you can. I have 12 and 15 year old boys and I think a lot about how 10 years ago I assumed I'd be pushing them to learn how to code and now I think that's a lot less important. >> Are there certain sectors or areas which you would really point people to look at right now? >> I think a couple things. It's an awesome time to start a business. That's what I tell my son. For example, my son's 19 and he's an entrepreneurial kid. He's in college and like Tom my son's telling me I'm like Tommy you've always wanted to start a business AI makes it easier and cheaper than ever to start a business. Maybe his business won't be the next Google but it could provide you know economic security for him and his family. So I I'm encouraging and that's another thing Razos is going to do. we're going to fund and operate um small business accelerators to help people use AI to start a business. So, I think that's really important. Develop those entrepreneurial skills. Um I think, you know, there's going to continue to be growth in healthcare. There are certain jobs where there's always going to have to be a human. Um I also think I do believe that the we'll probably get to a place that like you said Bill Gates is mentioning which is we have to save some jobs for people. Uh and I think we'll probably get there. I mean the truth of it is truthfully there's way more hype about AI than actually its capabilities at least now. And I think what we're going to find is once the hysteria dies down and the hype dies down, you're going to see ability to reason, ability to think, ability to interact with a human being, ability to have the whole context and make a decision, judgment, decision making. These are going to be things we need forever. Well, there's certainly a lot of layoffs that have been attributed to AI, so we'll see um how that all all plays out. But I would love to pivot now to what we're calling our AI power check. This is kind of rapid fire questions. Give your first reaction and we're asking these same questions to everyone we interview that for the changemakers podcast. So the first question is, what is the most meaningful thing you use AI for personally or professionally? >> Uh research. What kind of research >> like right now in RA US I'm studying like crazy how does every country in the world do unemployment insurance or or subsidies studying like crazy what other countries and certain states doing for job transition. It's unbelievable how you know fast you can get that whole comparison. Do you check your sources? Yeah, I do actually. Always. That's a good point. I I mean I'll be honest. I use AI like if I'm going to write a long email, if I'm going to write a long memo, if I'm going to do a lot of research, I start with the AI as like a draft and then I make it my own in the same way I always would. Where do you see AI creating the most measurable value in your organization and what proves that it's working? uh we have a lot we have a in raise us we have a data and policy arm of what we do actually I should have said that we have two things we have a data and policy in for which we've we not taken any corporate money so new ideas and then we have the implementation arm where we try the ideas developed in the data and policy side I see huge opportunity for AI to enhance the way we predict, you know, who's going to be the most affected by AI disruption. How much do you think AI poses a risk to women in the work workforce and will widen gender gaps? A a lot. Significant. Very significant. it like just right now for example if you're a non-educated man the trades jobs plumbers pipe fitters electricians etc they're actually in huge demand which is excellent um and by the way if I were a young woman I would investigate those jobs if you think you're a person who wants to work with your hands cuz they're good and they're stable they're not AIable and they're high paying. But unfortunately, right now those jobs are mostly going to men. If you're a non college educated woman, you're probably in a job, like I said before, call center, maybe hospitality, but you you're in jobs that are very AI vulnerable. And so I I'm I'm I'm very worried about this. Another question in our our rapid fire here is is there a responsibility you will never delegate to AI and why decisions any decision I would use AI to inform but I would make a decision by 2030 if you're still running raise us what do you think AI is going to be able to do for the organization uh that it can't do That's a great question. Much better teaching and training of people like much better. In an ideal world, Gina, 55year-old woman loses her job. I should be able to like really quickly get myself on some kind of state support, immediately get my skills assessed, immediately start some training to find a job that's specific in my community. Um, we are a ways away from that now mostly because all the data for that to happen. It isn't it's not just the AI. It's like all the data has to come together in a clean way for this, you know, for that to work. So 2030 is probably the right time. I think that would be amazing. I'd love to get a few more questions in about your leadership style. Um because right now you're building bridges between states, companies, employees, all the different factions. What is the secret to being bringing together factions that are often at odds with each other? How do you figure that out? You have to well, I'll tell you how I do it. You have to explain to them why it's in their interest to do whatever it is that you ask them to do. So when I go to a CEO, I say to them, 12% unemployment rate, riots in the streets, and massive regulation is not in your interest. So you should get with me now. If I go to a governor, I say it's not in your interest to have all your constituents afraid of AI and blaming you. So I think, you know, the no interest like self-interest. I I think people need to be motivated and they will be more motivated if they understand why it matters to them. I've heard from so many business leaders from both sides of the aisle, people who I don't think agree on very much at all who have so much respect for you and your ability to have low ego and think about outcomes and be practical. What have you learned in all of your years in these different roles about how to navigate a partisan landscape and earn the respect and the collaboration of leaders on both sides of the aisle? I am obsessively outcome oriented. And so if you're really focused on the outcome, you'll talk to anyone, become friendly with anyone, listen to anyone, work with anyone, um, and just constantly come back to the substance. And for me, that has worked. You know, as a Democrat, uh, when I was an elected official, I cut taxes every year in my state. I spent a lot of time talking to businesses every day. I was criticized by being too close to business. But the truth is we like I inherited a terrible economy and left a fantastic economy. Uh I made great relationships with Republicans when I worked for President Biden. Um, even you know, maybe sometimes some of the folks in the White House didn't want to have spend the time to do that, but I did cuz I wanted to get things done. I know you have to go, but I have two very quick final questions. Okay. One is, what do you think is your leadership superpower? >> Uh, I think I'm principled. Like anyone who's ever worked for me, I hope will tell you it's never about me. It's about the mission we're trying to achieve together. And I think that that helps. And my last question is sort of a fun one. You've had so many busy jobs. You have kids now in their 20s. How have you figured out how to juggle it all? Do you have any key life hacks? We've heard of some pretty great ones from other change makers. Embrace the chaos. That's my life hack. Embrace the chaos. You know, I've been asked so many times, how do you do work life balance? Like, it's not always balanced. And if it doesn't feel balanced, if you have a day or a week or a month or a year where every day is just getting through it and it's crazy, don't beat yourself up. News flash, we're all going through it the best you can on any given day. Do not I tell this to my kids, don't waste one second beating yourself up. Should have been better. Should have been cleaner. Bup. Get rid of the word should have. Embrace the chaos and just keep going. >> Well, that is a perfect note to end on. There is certainly a lot of chaos in my household. So, I will I will take that to heart. Secretary Rayondo, thank you so much for taking the time with us today. [music] Thank you for having me. That's it for now. I hope you enjoyed my conversation with [music] Secretary Rayondo. On next week's episode of the CBC Changemakers podcast, [music] I talked to Kate Ryder, founder and CEO of women's healthcare company Maven. >> One of our values was keep healthcare [music] human. Um because 10 years ago, everyone thought robots were replacing doctors. So, we're now back at that with that same um narrative except it's AI replacing doctors. I can't wait for you to hear it. [music]