Viral social media post sparks debate over whether making $500K in San Francisco puts you in the 'permanent underclass' - California News Beep

Can someone making six figures really be disadvantaged? A recent viral social media post delved into the debate about tech workers who fear they’re part of a “permanent underclass.”

Tech workers in Silicon Valley have been grappling with the upheaval of AI, and like workers in many other industries, they are questioning their futures.

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Venture capitalist Deedy Das commented on the wealth divide in San Francisco when it comes to AI and those who have struck gold.

Das said in a post that, over the last five years, about 10,000 employees at companies such as Anthropic, OpenAI, xAI and Nvidia have “hit retirement wealth of well above $20 million (1). (1)”

But, for “everyone outside that group,” the feeling is that they can work their “well paying” but less than $500,000-a-year jobs “for their whole life and never get there,” Das wrote.

For the average American, making six figures and feeling hard done by might be unimaginable. After all, the median U.S. household income according to the most recent U.S. Census Bureau report was $83,730 (2).

Das notes in the post that many people reading it would “scoff at the champagne problems” of Silicon Valley. “Society is warped in this tech bubble. What is often well-off anywhere else in the world is bang average here,” Das wrote.

Still, tech workers have been facing mounting layoffs, with more than 150,000 workers laid off collectively from large tech companies since 2022, according to a report from the New York Times. The report describes the “unraveling” of what once seemed like an industry that guaranteed “affluence and employability. (3)”

“The threat of being replaced by artificial intelligence has loomed over those” who still have their jobs, the report says, describing the culture at tech companies shifting to the point where “throbbing economic anxiety infects almost every conversation.”

Das’s viral social media post also notes this “deep malaise about work (and its future)” that many in tech are feeling: “Why even work at all for ‘peanuts’? Will my job even exist in a few years? Many feel helpless.”

Das goes on: “You hear the ‘permanent underclass’ conversation a lot, [especially] from young people.”

AI fears

The idea that workers making six figures could view themselves as part of a “permanent underclass” sounds like it could be a joke.

It turns out, this idea is rooted both in humor and a real fear of what the future will look like with the advancement of AI.

According to a report from the New Yorker, the “permanent underclass” fear has become fodder for Silicon Valley meme accounts, but it stems from an influential essay written by former OpenAI employee Leopold Aschenbrenner (4).

In the essay, Aschenbrenner says “it is strikingly plausible that by 2027, models will be able to do the work of an AI researcher/engineer. (5)”

Reaching this point, the New Yorker report says, would mean that “technological progress would become self-reinforcing, operating on a runaway feedback loop: AI would build more powerful AI on its own, rendering humans superfluous.”

So while it may be hard to have sympathy for someone who makes six figures but is dismayed that they’re not making tens of millions, the anxiety about a “permanent underclass” in tech seems to be rooted in the fears about AI that have rippled through many industries.

Jasmine Sun, who writes a newsletter on Silicon Valley culture, told the New Yorker that many tech workers are now “really struggling and can’t find even a normal salary, and some of the people are raking it in with these never-seen-before tech salaries. That creates this sense of bifurcation.”

Viral social media post sparks debate over whether making $500K in San Francisco puts you in the ‘permanent underclass’

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