First of all, I should say that I don't think AI will ever becomes "sentient" - not in the way that organic beings are. This isn't as much due to biological vs. silicon life, but is more philosophical and has to do with my view that the human being - all living beings, really - are "receivers of consciousness," which isn't tied to physicality at all, but just is embodied within it - not unlike a radio signal "embodies" a radio.
Meaning, I don't think we're capable of creating conscious, sentient beings. Even if it is theoretically possible, the technological advancement involved with creating a physical thing that can house and transmit consciousness (which is non-physical), is beyond imagination. All we can (ever?) do is create simulations of behavior and activity. So yes, we can make AI that can process info like a computer, or make the semblance of art. But it cannot be truly sentient - or en-souled. Again, this is just my personal neo-mystical philosophical outlook.
But obviously AI is a reality, and one that will have an increasing presence in our life. It already has for decades, and for the last 10-15 years or so, we've all had simple AI devices in our pockets.
The reason I mentioned the soul/consciousness element, is that one concern I have is applying it to human things, that only sentient beings can truly do. Not only is this just a bit gimmicky, like making your dog wear human clothes and "watch" tv, but it is a terrible misuse of time and energy.
What seems to be the focus, based on what I see out there, is AI focused on making money, on enabling the rich to get richer, and in replacing things that only humans can really do, whether it is create art or be a therapist. I mean, what is worse than seriously entertaining the question, "Should we spend less on AI art, or more on human art?" OK, here's something worst: AI therapy, or AI partners.
What I think AI research and application should be focused on, that is its "best use," is two-fold:
1. Computing data that helps us solve problems, be it using a calculator or figuring out sustainable means of energy production.
2. Increasing what amounts to "free time" - that is, time that we don't have to do anything.
(I'm sure there are many other good uses, but I'm just writing as I consider...this isn't pre-composed)
As mentioned, the former is already happening and will continue to happen. The problem, though, is that it mainly happens within the framework of profit: Meaning, solving problems that lead to greater profit - not necessarily greater well-being of the majority of human beings. Not to mention that a lot of problems probably have been solved, but are never put out to the wider public because they threaten the profits of very powerful people. This is why we have incredibly advanced iPhones but still mostly drive vehicles that get 20-30 miles per gallon.
The latter relates to what the OP says about "what will people do in a post labor society?" It mentioned "just hanging out" with a pejorative connotation, as if that's a bad thing. Just hanging out allows us to gaze at the stars, to laugh with friends, to sing and dance and create art or treehouses or whatever it is we feel like. People could still work, but it can be work they want to do -- optional. But what they do with their time is entirely up to them...and many/most will find something to provide meaning, because humans are essentially creative beings.
In other words, I think AI could help us breakdown the nasty work/play binary that the Agricultural Revolution exponentially increased, and then the Industrial Revolution hammered home (along with other benchmarks along the way). Meaning, AI could theoretically replace what we consider as "work," increase "play" - and because there's more time to "play," some of that will becoming "meaningful play" (aka, "art"). The future conflict won't be work vs. play, but leisure play vs. meaningful play. A lot of us already experience this tension (ahem).
What I'm hypothesizing is this, that the dominant focus of human existence has changed over tens of thousands of years, roughly like so:
Pre-agricultural: play*
Agricultural/civilizational: work
Industrial: work vs. play
Post-industrial: leisure vs. creativity (or play vs. art)
Whatever's after that: art (and maybe, "creating vs. being")
*note: The average hunter-gatherer worked about 20 hours a week, and their work was directly meaningful: gathering and hunting food, making useful things, etc. They had a lot of time to just hang out, to look at the stars, and consider the nature of their reality - which is probably how storytelling and art began. Work time was greatly increased with division of labor and agriculture - and work became less and less directly meaningful as people "worked for" others (the gods, kings, or simply wealthier people), more so in the last century or two.
Consider that we existed as hunter-gatherers (or at least pre-agricultural) for 300,000 years or so...at least that's when anatomically modern people first showed up, to the best of our current knowledge (and that date keeps getting pushed back). Agriculture is about 10-12,000 years old, urban civilization 5-7,000 years, and industrial 200 years, give or take. Meaning, over 95% of human existence was pre-agricultural, and 99.99% was pre-industrial. The point being, what we take for granted is an aberration: like a few thousand years of warm weather within a million-year Ice Age...it isn't an "ice age," it is a short "warm age" within an icy norm, but we have it backwards.
So it may be that what we're moving to is a post-industrial civilization that has certain elements more in common with pre-industrial than industrial: namely the nature and balance of work, play and art. One difference, however, is that we'll all be part of a "global village." But that's another topic...
I think we're in the early stages, the rocky period, of this transition. It might take a century or two, though.
