The effect of AI on employment

Innovative Automation is appearing everywhere. We´re surrounded by it. Ready or not, innovations like robotics, computerized algorithms, artificial intelligence, augmented reality, medical sensors and machine-to-machine communications, 3-D printing and autonomous vehicles will increasingly transform the global economy, even displacing some of our human workforce. How do we react to this?

Emerging technologies, like artificial intelligence and machine learning are advancing at a rapid pace, the film industry jumps at the Chance and the idea of robotic intelligence with movies like ex machina,  but there has been little attention to their impact on employment. But what happens, if robots end up taking jobs from humans and how will this affect the job market ?

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While emerging technologies can improve the speed, quality, and cost of available goods and services, they may also displace large numbers of workers, if we aren´t prepared.  This possibility challenges for example the traditional benefits model of tying health care and retirement savings to jobs.  In an economy, that employs dramatically fewer workers, we need to think about how to deliver these benefits to displaced workers or how we can encourage them to face new challenges in new Job environment.

The impacts of automation technologies are already being felt throughout the economy. The worldwide number of industrial robots, not only in the medical sector, has increased rapidly over the past few years. This is a consequent and necessary step into the right direction, because we can´t afford to stagnate. The falling prices of robots though, which can operate all day without interruption and only need routine  maintaince,  make them cost-competitive with human workers and in long term they will definitely outdo them.

In the service sector, computer algorithms can execute stock trades in a fraction of a second, much faster than any human being could ever deliver these results. As these technologies become even smarter, cheaper, more capable and more widespread, they will find even more usage in the economy.

The most recent trend towards increased automation stems partly resulted from the Great Recession, which forced many businesses to operate with fewer workers. After growth resumed, many businesses continued automating their operations, which is an investment in first place, but cheaper long term, rather than hiring additional workers. This echoes a trend among technology companies, that receive massive valuations with relatively few workers.  For example, in 2014 Google was valued at $370 billion with only 55,000 employees, Netflix with 3700 employees is worth $39 billion, a fracture the size of AT&T’s workforce in the 1960s.

Experts disagree on the size of the impact that automation technologies will have on the workforce.  While some warn of staggering unemployment, a second group argues, that computers will have little effect on employment in the future.  Any policy measures that address the future of employment must account for the uncertainty of outcomes on employment.

Others, from an IT point of view, point out, that technology may create new job categories, that will employ former displaced workers from their previous jobs. That being said employees would have free resources to focus on new projects, rather than constantly remaining on the same spot while not using their most valuable asset, their ideas and creativity. Automation gives people spare time to restructure their workforce. So what we need to do is, to prepare ourselves accordingly and embrace change and all the new opportunities given.

We need innovation, we need creativity, we need to take this new approach and see it as it is, a chance, we should take.