The Rise of AI and Its Impact on Employment

Artificial intelligence is rapidly transforming the workforce, helping companies reduce costs and boost efficiency. As profits rise, so do stock prices, creating a stark contrast between the struggles of employees and the gains of investors.

A Personal Wake-Up Call

Back in 2012, as an engineer in the tech industry, I witnessed firsthand the fear of job outsourcing. Co-workers competed in what we called 'the stress Olympics,' skipping vacations and even suffering health issues from overwork. One colleague collapsed at his desk, with doctors comparing the stress to smoking two packs of cigarettes daily. He returned to work just a week later, only to face layoffs disguised as a 'departmental re-organization.' The company's stock soared, and investors celebrated, indifferent to the human cost.

This was my turning point: I realized it might be better to be an investor than an employee.

Making the Shift to Investing

I abandoned my dream of homeownership in Toronto, where climbing the property ladder had been my focus. Instead, I took my down payment fund and invested it in the stock market. Many thought I was crazy for choosing stocks over real estate, but I saw the risk in tying myself to a job that could vanish without warning.

Within three years, my investments grew enough that I no longer needed my job to pay the bills. I quit in 2015 and never looked back.

The Escalating Threat of AI

Fast forward to today, and the job market has worsened immeasurably. Even remote workers earning low wages are now at risk, as AI can work for less, never takes breaks, and doesn't ask for raises. How can humans compete?

Bill Gates predicts that AI will replace most jobs in the next decade. Software engineers aren't safe—Microsoft reports that 30% of its code is written by AI. Facebook is developing AI that builds other AI models, and even brain surgeons face competition from AI performing surgeries autonomously.

Unemployment and Market Dynamics

Canada's unemployment rate recently rose to 7.1%, the highest since 2016 outside the pandemic. A combination of tariff stress and AI-driven job replacement has created the most brutal job market since the 2008 financial crisis.

Yet, the stock market tells a different story. The TSX has gained 18% year-to-date, reaching an all-time high. As AI replaces jobs, companies become more efficient and profitable, driving stock prices up.

The Investor's Advantage

The safest place to be is on the investor side. By investing in low-cost index funds, you can participate in the AI revolution by owning shares in diverse companies. Diversify and invest passively for long-term success.

We can't stop AI, but we can choose our role. Becoming an investor allows us to reap benefits without job insecurity. The FIRE (Financial Independence, Retire Early) movement, once fringe, is now a necessity as even stable careers like software engineering are threatened.

The era of relying on a job for 25 years is over. Embrace investing for a secure future.