AI to Disrupt Job Market, Warns IMF

With the proliferation of AI-based tools in recent times, it was a widely-prevalent belief that Artificial Intelligence (AI) would eventually disrupt the job market on a global scale. It has proved to be partially correct so far, with the AI intrusion causing layoffs by the tech companies. Now, in a new research paper, the International Monetary Fund (IMF) has made a prediction that jobseekers the world over could find scary.

The IMF believes that AI would impact about 60 percent of jobs in advanced economies while in emerging markets and low-income countries, it would impact 40 percent and 26 percent of jobs respectively.

The international organization published the findings in a paper titled ‘Gen-AI: Artificial Intelligence and the Future of Work’. The paper’s authors and editors include Mauro Cazzaniga, Florence Jaumotte, Longji Li, Giovanni Melina, Augustus J Panton, Carlo Pizzinelli, Emma J Rockall, and Marina Mendes Tavares.

AI’s Impact In Advanced Economies: What The IMF Research Says

Of the 60 percent of the jobs that the IMF thinks AI would impact, roughly half of them “may benefit from AI integration, enhancing productivity”, says the IMF research paper. The other half would see AI applications taking over to “execute key tasks currently performed by humans”, which could lead to lower demand for labor.

A lower demand for human labor would cause lower wages and fewer hirings, says the IMF paper. It even goes on to say that in extreme cases, some of the jobs would “disapper”.

<img alt="AI's Impact In Advanced Economies" data- data-src="https://kirelos.com/wp-content/uploads/2024/01/echo/Untitled-design-2024-01-16T141227.944.png" data- data-wp-effect="effects.core.image.setButtonStyles" data-wp-effect–setstylesonresize="effects.core.image.setStylesOnResize" data-wp-init="effects.core.image.initOriginImage" data-wp-on–click="actions.core.image.showLightbox" data-wp-on–load="actions.core.image.handleLoad" decoding="async" height="400" src="data:image/svg xml,” width=”800″>

How AI Could Impact Jobs in Emerging and Developing Economies

Coming to the emerging markets and low-income countries, artificial intelligence is still going to affect jobseekers, though not on the level of developed economies for now, as per IMF. That’s due to the fact that many of the developing economies reportedly do not have the “infrastructure or skilled workforces to harness the benefits of AI”. While this may look like good news for human labor, the report states that the AI-caused technological disparity between the advanced and developing economies may “worsen inequality among nations.”

The IMF paper also predicts a rise in labor income inequality if “the complementarity between AI and high-income workers is strong.”

Women and College-Educated May Benefit From AI-Exposure

With its spread in the international labor market, artificial intelligence can reshape the global economy, says the IMF research paper. Initially, compared to emerging economies, AI would affect employment in advanced economies more since their job sector is structured around cognitive-intensive roles.

<img alt="Women and college educated AI exposure" data- data-src="https://kirelos.com/wp-content/uploads/2024/01/echo/2-7.png" data- data-wp-effect="effects.core.image.setButtonStyles" data-wp-effect–setstylesonresize="effects.core.image.setStylesOnResize" data-wp-init="effects.core.image.initOriginImage" data-wp-on–click="actions.core.image.showLightbox" data-wp-on–load="actions.core.image.handleLoad" decoding="async" height="400" src="data:image/svg xml,” width=”800″>

Based on consistent patterns seen on AI exposure, the IMF paper predicts that women and college-educated individuals will be more exposed to AI and hence, also could benefit from the AI exposure. On the contrary, older workers who find it difficult to adapt to AI technology, may not be that fortunate. It seems like being AI-shy could be detrimental to jobseekers.

IMF Research Summary: What Nations and Humans Can Do

The IMF research paper advises advanced economies and more developed emerging markets to “focus on upgrading regulatory frameworks and supporting labor reallocation, while safeguarding those adversely affected.” For developing economies, the advice is to “prioritize developing digital infrastructure and digital skills.”

At the same time, the research paper advises working professionals, jobseekers and humans in general to develop digital skills to be industry-ready.

<img alt="humans should learn digital skills" data- data-src="https://kirelos.com/wp-content/uploads/2024/01/echo/1-7.png" data- data-wp-effect="effects.core.image.setButtonStyles" data-wp-effect–setstylesonresize="effects.core.image.setStylesOnResize" data-wp-init="effects.core.image.initOriginImage" data-wp-on–click="actions.core.image.showLightbox" data-wp-on–load="actions.core.image.handleLoad" decoding="async" height="400" src="data:image/svg xml,” width=”800″>

• Winner of The 21st Century Emily Dickinson Award for his debut book ‘The Heart of Heartbeats’, Utkarsh found his calling to be a writer while studying engineering and has been writing professionally for over six years now. After completing… read more