What Bank ATMs Teach Us About AI

Stephen Moore on Aug 11, 2026

New inventions and technologies, from the lightbulb to the farm tractor to the automobile to the laptop computer to Uber drivers, cause serious job market disruptions. They also cause a backlash, as horse and buggy operators, cab drivers, video rental stores and typewriter makers inevitably predicted chaos and job losses.

Artificial intelligence will make life much better and healthier for most people, but it will bring massive disruptions too.

What will happen to the people whose livelihoods are jeopardized by what ChatGPT or Claude can do faster, cheaper and better? It is a fair question. But let's look at one of the inventions of the past several decades that we almost all use routinely: the automated teller machine.

In 1969, a branch of Chemical Bank on Long Island installed a device that counted cash and took deposits. It never called in sick and never asked for a raise. And it worked quickly and didn't take coffee breaks.

As millions and then tens of millions of Americans started using these 24/7 cash dispensers, the worry was that bank tellers would join elevator operators in the museum of extinct occupations. Some bank employee groups protested the machines, warning that they wouldn't be safe for customers to use.

But by the mid-1990s, banks were installing them at stores, stadiums, restaurants and even churches.

By 2020 nearly 500,000 ATMs had been installed, and many customers paid a fee to use the machines.

Boston University economist James Bessen investigated what happened to bank jobs.

The first finding was that ATMs did exactly what the pessimists predicted at the branch level: It cut the tellers needed to run an average urban branch from about 20 to about 13. But a branch that is cheaper to staff is a branch worth opening on a corner where the numbers never used to work. Banks opened them. So as the number of ATMs at neighborhood banks proliferated, the number of urban branches grew 43% -- as fewer tellers were needed per branch, more branches and jobs associated with them appeared.

There was a second effect too. Once the machine took over the counting, the work it couldn't do became more valuable. Tellers stopped being effectively robots dispensing cash and depositing checks. They became financial service providers. They walked you through a mortgage and knew your kids by name. Banks called it "relationship banking." The machine took the tedium; the tellers became customer service reps.

Studies also show that tellers got paid more as they moved into more tedious and repetitive jobs. Teller jobs declined, but bank employee pay rose as human tellers became more indispensable to local customers.

Banks also responded to the ATM revolution by successfully urging changes in outmoded federal banking laws, such as a commonplace one that allowed expansion of interstate banking instead of banks being confined to a single state.

Technology changed the whole nature of banking. Congress passed the Electronic Signatures in Global and National Commerce Act of 2000, which gave electronic signatures the same legal standing as ink signatures.

The broader economic benefits of the banking tech boom were even more substantial. Because ATMs gave most consumers instant access to cash, consumers began spending more. Bank customers without credit cards could get cash on a weekend and spend it. This helped local businesses survive and even thrive.

The Labor Department expects further declines in bank service jobs, but the ATM did not do that. The ATM in part gave way to the smartphone and Apple Pay, which allowed customers to go cashless.

AI will certainly bring job disruption. But so did Apple, Google, SpaceX and Walmart. Robots will soon do much of the menial and backbreaking work that humans have had to do throughout time.

Part of everyone's job will be made obsolete as AI continues to bring more information to our fingertips than is available in every book in the entire Library of Congress, and it is already bringing more services to our doorstep than 1,000 UPS drivers. (Admission: I even used the wonders of AI to help write this column.)

Would anyone want to turn back the clock to a time before ATMs? Ironically, as we become a cashless society, ATMs may also become obsolete.

The American worker's competitive edge has never come from being shielded from the machine. It has come from getting the machine before everyone else in the world does.

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Stephen Moore is a former Trump senior economic adviser and the cofounder of Unleash Prosperity, which advocates for education freedom for all children.