One of the givens we have come to accept since OpenAI rolled out ChatGPT 3.5 on November 30, 2022, is that AI’s lack of empathy is one core reason organizations will continue to need humans “in the loop.”

This assumption is flawed on at least two levels. First, it dismisses the potential for AI to mimic empathy. While AI has no emotions and can never be truly empathetic, it certainly can act like it is. Second, even though humans can empathize, they are not always empathetic, even when empathy is called for.

Nothing in the real world demonstrates this better than recent news from Allstate, the nearly 100-year-old insurance giant ($57 billion in revenue in 2023). One of an insurance company’s most common activities is the back-and-forth communication between a customer who has filed a claim and the representative handling the claim.

Customers were unhappy with these interactions. According to Zulfi Jeevanjee, Allstate’s chief information officer, “When these emails used to go out, even though we had standards and so on, they would include a lot of insurance jargon. “They weren’t very empathetic…Claims agents would get frustrated, and so it wasn’t necessarily great communication.”

Nearly all of Allstate’s messages to claimants are now written by AI, and customers are happier with them. They don’t make accusations, as claims agents did. They don’t contain a lot of jargon. They’re friendly. They convey empathy for the claimant for whatever situation led them to file a claim.

So far, Allstate insists no layoffs are planned. Since generative AI still hallucinates and makes mistakes, Jeevanjee claims agents still review every message before sending it. “But they’re not writing them anymore.”

If claims adjusters at Allstate feel secure, though, they should look to Fukoko Mutual Life Insurance, a Japanese insurance company that laid off 34 staff members and replaced them with AI.

It happened in 2017, five years before generative AI made its big splash.

Fukoku said it would increase productivity by 30 percent by using an AI system to calculate insurance payouts.

The IT sector’s unemployment rate rose to 5.7 percent in January, compared to 3.9 percent in December, exceeding the 4 percent national unemployment rate. AI is the main reason. Salesforce CEO Mark Benioff has been upfront about it, saying Salesforce may not hire a single software engineer in 2025 since AI can handle all their work.

Copywriters in advertising agencies and related industries have been laid off and replaced by AI. Forrester expects ad agencies to replace 7.5 percent of jobs with AI by 2030.

Last June, a CBS News report found 4,000 jobs had been eliminated by AI. The Washington Post headlined an article, “ChatGPT took their jobs. now they walk dogs and fix air conditioners.” One from the BBC tells about “The workers already replaced by artificial intelligence.”

At the recent European AI summit, U.S. Vice President J.D. Vance insisted AI will only make workers more productive, not replace them. He’s selling snake oil. The layoffs are already happening and will accelerate. At the same time, people with AI skills will fill newly created jobs. Salesforce, for example, is cutting 1,000 jobs this year but filling 2,000 AI-focused roles.

That’s cold comfort to the specialists in non-AI jobs who will find themselves looking for work in an increasingly tight job market. We should be preparing for this. Instead, we appear to be languishing in a state of denial.