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AI to Affect 40% of Jobs and Intensify Inequality, IMF Warns

January 15, 2024
in Technology
AI to Affect 40% of Jobs and Intensify Inequality, IMF Warns
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AI to Affect 40% of Jobs and Intensify Inequality, IMF Warns

The International Monetary Fund (IMF) released a new analysis on January 14, warning that 40% of all jobs around the world are likely to be affected by AI. 

While AI would complement some of these jobs, others would be replaced altogether. Kristalina Georgieva, the IMF’s managing director, further warned that “in most scenarios, AI will likely worsen overall inequality”.

The impact of AI on employment would vary across the world, with some countries suffering the impact more than others. The US and Europe are expected to face much greater disruption than low-income countries and emerging markets.

The Projected Impact of AI on Jobs: A Deeper Understanding

Since the beginning of the generative AI frenzy with the launch of ChatGPT in 2022, powerful AI models have become widely available. The rapid proliferation of artificial intelligence has resulted in widespread job cuts and mass layoffs by companies of varying scales, including leading tech giants like Meta and Google.

Describing the situation as a “troubling trend”, Georgieva

The reduced demand for labor would not only cause a reduction in wages but can also eradicate jobs altogether.

requested policymakers to address it and prevent technology from causing any more social tensions.

According to the IMF’s analysis, AI will affect around 60% of jobs in advanced economies – which is quite significant. 

The good news, though, is that the integration of artificial intelligence will likely benefit workers in about half of these instances. By complementing human labor, AI can significantly improve productivity in these instances.

In the remaining instances, however, AI could replace human workers as it becomes increasingly capable of performing tasks that are currently carried out by humans. 

In low-income countries, only around 26% of jobs will be affected by AI, the IMF predicts. This is largely because many of these nations lack the infrastructure and/or skilled workforce necessary to fully benefit from AI, Georgieva explained. 

However, the IMF managing director also warned that this significantly increases the risk of growing disparity between countries.

At a more individual level, younger and high-income workers might enjoy a steep increase in earnings upon adopting AI. On the other hand, the IMF fears that low-income and older workers would be falling behind as the situation puts them at a disadvantage. 

IMF Suggests Solutions, European Parliament to Vote on AI Act Proposals

Georgieva also shared possible solutions to the issue, recommending countries implement “comprehensive social safety nets”. 

Considering AI’s potential to augment human capabilities in most cases, at least initially, supporting workers with retraining programs would help too, she suggested. 

It’s worth noting that the IMF analysis has been released at a crucial time when the World Economic Forum’s annual meeting is set to take place in Davos this week. 

With applications and tools like ChatGPT surging in popularity, AI will be one of the hot topics of discussion at the meeting.

As of now, regulations for AI vary around the world. Last month, the EU reached a tentative deal on legislation focused on governing the use of AI technology, transparency rules, and risk assessment. 

While the European Parliament will be voting on the AI Act proposals early in 2024, it won’t be until 2025 that the legislation will actually take effect. The UK, US, and China haven’t published any AI guidelines, with the US still debating its stance at the federal level.

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Copyright for syndicated content belongs to the linked Source : TechReport – https://techreport.com/news/ai-to-affect-40-of-jobs-and-intensify-inequality-imf-warns/

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