Post

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

Export-led growth did 3 things: earned hard currency, employed huge numbers of people, and made those workers steadily more productive by doing the work. High revenues alone aren't enough if fewer and fewer people are employed by that industry, as I wrote in my last post.

Data labeling is a common suggestion. It's a job *created by* AI. But this is prone to wage competition; Filipino rates on some projects dropped from $10 a task to <$0.01. And demand is shifting up the skill chain to experts like lawyers, doctors, etc. in high income countries

Another is agriculture - people need food, and AI is not growing it. But demand for food is capped, so when productivity rises, workers leave farming. And the real money is in the branding and marketing; farmers capture about 6.6 cents of every chocolate dollar.

Tourism only works if you have something enticing for visitors. Even then, there's a limitation on demand and how many people you can serve. Of the US sectors tracked since 1990, accommodation and food is nearly the only one where hours grew faster than output/worker.

Data centers look like an opening, since the US is blocking them amid local opposition. But for poor countries they mostly aren't exports: 80%+ of African data already sits abroad, a hyperscale campus hires ~150 people, and the margins go to the operator.

So why migration? Comparable workers (same age, schooling, experience) earn much more in the US than at home. If AI makes rich countries richer while that work stays human, that gap will only widen.

Rich countries are also aging into a permanent care shortage. This physical, relational work is among the hardest for AI to automate. Home health aides are the fastest-growing US job by a wide margin: +740k by 2034, nearly 3x the runner-up.

This is, of course, sensitive to not only demand but also the politics of migration. And remittances aren't the same as a growing domestic industry; they mostly fund consumption and housing.