Larry Fink: Expect Inflation Prior to AI and Robot Economy

Blackrock founder Larry Fink is warning President Donald Trump’s MAGA policies might cause some inflation before emerging technology allows American citizens to earn higher wages without inflation.

The mega-investor on Wall Street told a March 10 conference hosted by S&P Global:

When I go to Washington, when they talk about these [MAGA] policies, I ask “At what cost are you willing to tolerate [wage-driven inflation]? Yes, we may have opportunities to create better and more robust jobs, but then the offside of that will be, it will probably create a little more elevated inflation in the short run.

The “little more” inflation from rising wages can be reversed by productivity gains from emerging technology, Fink said. The “big deflation because of the advancement of AI and robots … is going to reshape the economy,” Fink said.

Foreign companies are already deploying the new technology that also shrinks inflation, he said:

I was with an Asian CEO that builds phones and they’re now applying AI robots — robots that have much more tensile dexterity, that they believe over the course of the next two years, their workforce will be down 30 percent with the advent of more technology and more robotics.

If you translate that across all the economies, we’re going to have shortage of [workers for] some things, like I said, in construction and electricians, and we’re going to have job [reductions] in many other industries that robots through AI are going to [cause].

China has invested heavily in robots and automation and leads the world in manufacturing output and in manufacturing technology.

Fink described the balancing act that faces Trump and his deputies:

With the whole idea that we’re going to have to use private capital to build up this economy, are we going to have enough workers? I’ve even told members of the Trump team that we’re going to run out aof electricians as we build out AI data centers.

Trump’s promise of low migration and Fink’s worries about shortages of agriculture workers, construction crews, and electricians are good news for Trump’s blue-collar voters and their teenage children. That is because labor shortages ensure that U.S. workers and their families gain higher wages — and also ensure that companies will buy high-tech machinery to help them get more work and wages each day.

That result would be good news for GOP politicians because wage gains will likely prompt happy citizens to vote for Trump and GOP politicians in the 2026 mid-term elections.

Rising wages “are good for national politics if you’re a politician, for sure,” the U.S. Chamber of Commerce’s CEO told Breitbart News in 2020. “If you look the other side of your question: ‘Are decreasing wages good for national politics?’ Hell, no,” the then-president, Tom Donohue, said.

Many of these wage and productivity gains will be delivered by the foreign companies that are moving investment into the United States under Trump’s threat of tariffs.

But those wage and productivity gains, however, will be sunk if Trump and GOP legislators agree to import more migrants or H-1B visa workers because of loud demands from employers, investors, donors, ethnic politicians, Democrats, and their chorus of pro-migrant establishment journalists.

Fink manages $10 trillion of investments in many companies. His job requires him to balance his investors’ demands for maximum short-term profits and stock-price gains against other demands for the research and investment that create long-term innovation, productivity, and general prosperity.

In April 2024, Find suggested that American politicians should grow wealth via investment instead of via President Joe Biden’s policy of extracting migrant consumers, renters, and wage-cutting workers from poor countries.

“I can argue, in the developed countries, the big winners are the countries that have shrinking populations,” Fink said at a pro-globalist event hosted by the World Economic Forum in Saudi Arabia. He continued:

That’s something that most people never talked about. We always used to think [a] shrinking population is a cause for negative [economic] growth. But in my conversations with the leadership of these large, developed countries [such as China, and Japan] that have xenophobic anti-immigration policies, they don’t allow anybody to come in — [so they have] shrinking demographics — these countries will rapidly develop robotics and AI and technology …

If a promise of all that transforms productivity, which most of us think it will [emphasis added] — we’ll be able to elevate the standard living in countries, the standard of living for individuals, even with shrinking populations.

But on Monday’s event in Houston, Fink focused on the near-term inflation expected as Trump rolls back Biden’s mass legal and illegal migration. Fink argued:

I do believe deportations — and the speed at which it is happening — is going to have a severe impact on the agricultural sector [and] the construction sector.

I’ve talked to CEOs in the ag sector, and they remind me that 70 percent of the men and women who work in agriculture were not born in the United States. Many are U.S. citizens. Now many of them have work permits and many of them don’t. Now 40 percent of the construction workers were not born in the United States. You add that up and what’s going on? I think …  are we going to have enough workers to harvest the crops?

Biden’s high-migration economy reduced wage-driven inflation by importing several million migrant workers. For example, ages rose by less than 1 percent from January 2024 to January 2025 under Biden’s policies.

But Biden’s deputies forgot that migrants need housing, food, and autos — and those prices zoomed upwards at roughly 12 million migrants crowded into the United States. The resulting consumer-caused inflation caused massive political problems for Biden and his Democrats.

Trump has ended Biden’s migration policy, so he faces no additional consumer-caused inflation. But he and his deputies are zig-zagging forward, by welcoming modest wage gains for Americans while hoping those wage gains do not drive up prices and inflation.

So far, Trump’s deputies are deporting perhaps 2 million foreign criminals and migrants already ordered home by judges. Many other migrants are in hiding, some are being caught during workplace visits, and some are voluntarily going home — but there is no sign that Trump’s deputies are already targeting agriculture workers or construction crews.

Moreover, there are millions of unemployed American men and women who might replace deported migrants.

At least 5 million demoralized or alienated men have fallen out of the labor force since 2000, and are not officially counted as unemployed. Many can be cajoled, shamed, enticed, or pushed back into the workforce once companies run out of cheap workers. The return of the sidelined workers will reduce pressure for further wage gains, and so reduce inflation.

U.S. companies will also likely increase efforts to raise productivity via high-tech automation, just as they did in Trump’s first term.