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AI Primarily An Enhancer Today, Job Displacement Real, Yet Not Near
Businesses, policymakers, and society at large must work together to develop an ecosystem to ensure that the benefits of AI are maximised.
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The impact of artificial intelligence (AI) on the labour market is a significant topic of debate and discussion. Several sections of society believe AI has the potential to transform the way we work and live. However, many others equally fear that AI catalysed transformation will have appreciable implications for the labour market.
*AI primarily an ‘enhancer’ today. Job displacement real, yet not near
Machines are increasingly evolving, enhancing capability, and performing tasks that were once the exclusive domain of humans. A Crux study across 500 academicians and industry leaders highlights that productivity and efficiency (as a result of automation) will drive growth, catalyse employment opportunities and trigger jobs. In addition to ‘growth induced’ jobs, several latent and new opportunities (development, deployment, and maintenance) may emerge in fields related to the proliferation of AI. Technology and the related system must be seen as allies, and productivity enhancing tools, as opposed to job disruptors in the short term.
India’s labour ecosystem is wrapped in a very tattered, moth-eaten fabric. It’s probably the only large economy with 80 per cent of its workforce in the unorganised sector. This sector cannot afford automation. Artificial intelligence is in its infancy in India, and ‘return on investment’ of automation is low as of now. The Crux study concludes that the geometric advancement in ‘ability’ and lowering cost will change the labour market earlier than imagined, potentially disrupting white-collar work as we know it.
*Impact of automation on jobs: complex, multifaceted, uneven
The Crux study shows that the impact of automation on the job market is complex, multifaceted, and nuanced, and will vary across industries and geographies. The ramification is likely to be uneven, with some sectors and occupations experiencing considerable disruption, while others may hardly be impacted. Similarly, not all jobs within industries are at risk, nor every role within that category. Impact will depend on a range of factors including the velocity of technological development, the talent landscape, stage of automation, specific applications of these technologies, and the socioeconomic panorama of society at large.
Technology has made inroads into each of the major activities ie. production, transactions, and interactions. Technology transformed manufacturing by augmenting and automating labour. A century later labour is ‘near’ redundant. Similarly, digitisation, automation, Chatbot’s and other automated systems may deepen the vulnerability for transactions jobs.
‘People’ intensive interaction processes such as customer service, has experienced little disruption. However, AI is set to change that. Today AI approximates human behaviour closely, subtly; importantly and effectively. In many cases, the combination of AI-human is multiplying capabilities, enhancing efficiency and impact.
*Embrace automation. Key to competitive advantage
The corporate sector is only beginning to explore and experience the value proposition. Organisations will need to invest in both appropriate capabilities, and enabling culture to navigate this new frontier, harness the power of AI, and eventually drive growth and innovation. They will require a strategic, cross-functional approach that encompasses technology, vision, and talent.
On a long and medium timescale, technology will eventually displace most existing jobs and reorient several roles. Over 100 million jobs, and 50 million Indians could be disrupted owing to the automation and optimisation capabilities of AI by the end of the decade.
*Leaps in technology: old jobs will go, new jobs will emerge
The Crux study visualises a silver lining. While some jobs are lost, new jobs and opportunities will emerge as businesses adjust to the changing landscape. The increased efficiency and productivity that AI delivers may also lead to the emergence of new products and services, in turn creating new jobs. Artificial Intelligence and related technologies could create between 200 million and 500 million new jobs globally by 2030, and over 40 per cent of these jobs could be in India. Many jobs and roles will emerge in new industries and sectors, largely as a direct result of advancing automation.
India must see this as an opportunity; policymakers need to develop an ecosystem where talent and technology can fuse in, to serve every stakeholder. Businesses need to identify models to take advantage of the unique strengths of both humans and machines. They must embrace a mindset of lifelong learning; invest in, and equip employees with the skills and knowledge to thrive in an AI-enabled world. According to the Crux study less than two per cent of workers in India have the requisite skills for 60 per cent of the new or restructured jobs that will be created in the next decade.
*Job Seekers Must Both Adopt & Adapt. Foster a Culture of Lifelong Learning
The labour market is evolving. The ground is shifting. They must invest in and adopt new skills.
India needs to design and equally implement policies that create jobs. Automation has the potential to increase efficiency and productivity, reduce costs, and open up new opportunities for growth and increased wages, fueling consumption, and triggering consumption. It could be a start to a virtuous job and growth cycle.
Low-skilled jobs are likely to be substituted by automation and shortage of high skills will accentuate job polarisation. The ecosystem needs to cohesively address and work together to create a more equitable and inclusive labour market, one that provides opportunities for workers at all skill levels. Society must consider the ethical implications of AI to minimise the potential for bias and discrimination in the labour market.
*Skill is the Currency
Governments also have a positive and critical role to play. They must develop policies that support workers and businesses as they navigate the transition to an AI-driven economy. This may involve revamping the education and labour policies. Similarly, they must offer tax incentives for companies that invest in reskilling and upskilling and provide financial support to the displaced due to automation.
Government policies must ensure that AI contributes to a more productive, inclusive, and sustainable economy and that the benefits of AI and automation are distributed fairly and equitably.
Artificial Intelligence has the potential to enhance human capabilities, create new jobs, and improve the quality of life for all. Businesses, policymakers, and society at large must work together to develop an ecosystem to ensure that the benefits of AI are maximised.