The rapid rise in AI is already changing the way white-collar workers operate and it has the potential to severely impact the price of real estate in certain suburbs, according to an expert.
Founder of Suburbtrends, Kent Lardner said certain suburbs across Australia have a workforce where up to 90 per cent of workers will be impacted in some way by AI.
He said if people were to lose their jobs, in the same way locations like Newcastle fell on hard times when the steelworks closed, or how Detroit saw huge declines, there could be a host of suburbs that could turn into white-collar “Rust Belt suburbs”.
“What we’ve got is a situation where, certain suburbs have a cluster, a significant proportion of people that work in predominantly white-collar jobs that are going to be impacted rather hard by AI and automation at a level that we’ve never expected or ever seen before,” Mr Lardner said.
“In the past, this has always been manufacturing, or coal mining and steel production.
“Now we’ve got the same challenge that hit Newcastle in 1999 with the closure of the steelworks, we’re going to have that same type of impact in general suburbia where there are large clusters of white-collar workers.”
According to Mr Lardner, Melbourne, Point Cook, and Craigieburn, all in Victoria, top the list of the potentially most affected suburbs.
Melbourne could see as many as 16,490 individuals impacted, followed closely by Point Cook with 16,132 and Craigieburn with 12,667 people.
In Sydney, Blacktown (10,340), Castle Hill (10,165) and Baulkham Hills (9403) all have a high potential to be impacted by AI, while in Brisbane, Coorparoo (5476) Thornlands (4613) West End (4519) could also be impacted.
While Baldivis in Perth, Morphett Vale in Adelaide, Sandy Bay in Hobart and Kambah in the ACT are all highly exposed to workers that might be hit hard by AI.
Mr Lardner said that an important question to ask is how governments would potentially handle widespread job losses in certain areas.
“What are they going to do if there’s 100 people who lose their job in one fell swoop in one or two inner city suburbs of Sydney,” he said.
“Are they going to put their houses, or units on the market in one go because they don’t have any income?
“Or are they going to be given universal basic income and, if so, is it going to be enough to sustain a million-dollar mortgage?
“Probably not.”
According to Mr Lardner, not all areas will be hit hard by AI, with some locations likely to benefit.
“I think there are a lot of places that are at the more affordable end of the scale, anything below $500,000, that’s probably in a pretty good spot,” he said.
“There’s a lot of locations around Australia that are at the more affordable end and will probably do quite well.
“And then the other one that I’d probably put my hand on my heart and say is I think that the rich are going to get richer.
“And as a result, all of the prestige suburbs I think will do extraordinarily well.
“I think your trophy homes will do very well.”
