OpenAI and Anthropic Revolutionize Finance with AI Automation
Revising pitchbooks, formatting slides, and tweaking font sizes are some of the tedious tasks that have long been the domain of entry-level investment bankers. However, with the advent of artificial intelligence (AI), these tasks are being automated, and former staffers from major banks are helping OpenAI train its AI to master such grunt work. According to Bloomberg, OpenAI has hired over 100 contractors who previously worked at firms like JPMorgan Chase, Morgan Stanley, and Goldman Sachs to take part in a secretive effort known internally as Project Mercury.
Participants in Project Mercury are expected to submit one financial model per week and are paid around $150 per hour. This development is likely to heighten anxiety among Wall Street’s junior bankers, as AI continues to take on work that was once the domain of entry-level employees. A study by Stanford researchers found that workers aged 22 to 25 experienced a 13 percent decline in employment across job sectors exposed to AI since late 2022.
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Wall Street’s Embrace of AI
Like many other industries, Wall Street is rapidly embracing AI, deploying it internally at firms from Morgan Stanley to Citigroup to Bank of America. Goldman Sachs is piloting an AI software engineer nicknamed Devin, alongside other initiatives, including the expansion of its GS AI Assistant platform. JPMorgan is investing $2 billion annually in AI, which is expected to lead to a slowdown in hiring due to AI’s “productivity tailwinds.” Jeremy Barnum, JPMorgan’s chief financial officer, told analysts during the bank’s third-quarter earnings call that the bank will “constrain people’s headcount growth.”
Goldman Sachs has expressed similar intentions, with CEO David Solomon and other executives stating that the bank plans to “constrain headcount growth through the end of the year” and carry out a “limited reduction in roles” as it focuses on opportunities created by AI. To apply for Project Mercury, prospective hires must first complete a 20-minute interview with an AI chatbot, followed by a test on their financial statement knowledge and a modeling test.
Competition in AI Development
OpenAI isn’t the only AI developer aiming to boost its financial expertise. In July, Anthropic rolled out a suite of Claude tools tailored for financial services firms. Cohere, a Canadian AI rival specializing in enterprise applications, counts the Royal Bank of Canada among its clients. Elon Musk’s xAI is also working to deepen its models’ financial knowledge, with plans to hire specialized domain experts to train its large language models (LLMs) in fields like finance.
As AI continues to reshape the financial industry, it’s clear that automation will play a significant role in the future of Wall Street. With companies like OpenAI and Anthropic leading the charge, it’s essential to stay informed about the latest developments in AI and their impact on the job market. For more information, read the full article Here.
Image Source: observer.com
