Recent news of significant corporate investments in artificial intelligence (AI) suggests this technology is moving toward mainstream use. Evidence for this includes DocuSign injecting $15 million into an AI contract discovery startup, Apple absorbing an AI camera developer, and CIO reporting that banks are expected to spend $5.6 billion on AI solutions in 2019, “ushering in the next financial revolution.” Indeed, the green shoots of AI are appearing everywhere.
Despite a surfeit of ethical concerns, leading AI advocates such as Andrew Ng are encouraging companies to jump into AI use. Many are doing just that. KPMG claims more than half of business executives plan to implement some form of AI within the next 12 months. One of the more common AI discussions is the potential impact on jobs. This impact is probably incalculable, though many try to estimate it. Gartner, for example, believes AI will create more jobs than it destroys between now and 2025. Previous technology revolutions have destroyed jobs but ultimately created new jobs and industries. That pattern has happened repeatedly, and this dynamic has now become conventional wisdom.
But not everyone is so sanguine when it comes to the impact of AI. In a 60 Minutes interview, Kai-Fu Lee, one of the world’s foremost experts on artificial intelligence, claimed that — in as soon as 15 years — AI technology could displace about 40% of the jobs in the world. The disruption is already beginning, with fully 75% of the organizations KPMG surveyed expecting intelligent automation to significantly impact 10 to 50% of their employees in the next two years. A Citigroup executive told Bloomberg that better AI could reduce headcount at the bank by 30%.
In the face of all this change, many companies publicly state that AI will eliminate some dull and repetitive jobs and make it possible for people to do higher-order work. However, as a prominent venture capitalist relayed to me recently on this topic: “most displaced call center workers don’t become Java programmers.” It is not only low-skilled jobs that are at risk. Gartner analysts recently reported that AI will eliminate 80% of project management tasks. This led SiliconANGLE to opine: “Project managers who are worried about the prospects of artificial intelligence one day stealing their jobs might do well to consider a career change as soon as they can.” The KPMG study found that virtually all organizations need help preparing employees for the changes ahead.
The risk of falling behind
A New York Times article noted that while many company executives pay public lip service to “human-centered AI” and the need to provide a safety net for those who lose their jobs, they privately talk about racing to automate their workforces “to stay ahead of the competition, with little regard for the impact on workers.” The article also cites a Deloitte survey from 2017 that found 53% of companies had already started to use machines to perform tasks previously done by humans. The figure is expected to climb to 72% by next year.
This perceived risk of falling behind is broadly affecting the C-Suite. For example, according to a Grant Thornton report, CFOs need to “alter their mindset when it comes to technology investments. CFOs must be willing to experiment — and incur failures along the way — or risk falling behind.” And as noted by a Harvard Business Review (HBR) article, returns for AI front-runners tend to be large. “They will benefit from innovations enabling them to serve (and perhaps create) new markets and, at the same time, gain share from non-AI adopters in existing markets.” Furthermore, the authors conclude: “A fierce competitive race among companies appears to be in prospect with a widening gap between those investing in AI and those that are not.”
The net of this dynamic is that workers are not a major factor in the economic calculus of the business drive to adopt AI, despite so many public statements to the contrary. So perhaps it’s not a surprise when the Edelman 2019 AI survey shows a widely held view that AI will lead to short-term job losses with the potential for societal disruption and that AI will benefit the rich and hurt the poor.
The trend toward AI is not inevitable, as issues could arise that will either slow down implementation or even bring it to a halt. Numerous ethical concerns have surfaced in recent months, and companies don’t want to be on the wrong side of an employee or consumer revolt. These countervailing pressures may provide some pause but are unlikely to substantially change the trajectory of adoption, as the business benefits are simply too great.
AI is the new reality, and it’s coming fast
Indeed, AI may be the fastest paradigm shift in the history of technology. The HBR article traces the time it took for other major technology advances including the web, mobile, cloud, and big data to reach substantial implementation levels and concluded that AI may take less than half as long.
The Brookings Institute takes a decidedly glass half full approach, noting that over the past 30 years technology has been a significant source of new job creation and opportunity. Nevertheless, they believe the US needs to help workers and communities adjust to job displacement and to reduce hardships for those who are struggling. In addition to traditional job-training programs, Brookings calls for a Universal Adjustment Benefit. This includes robust income support for workers in training but stops short of a call for Universal Basic Income (UBI), an unconditional periodic cash payment made by the state to all people regardless of whether or not they work.
Retraining for new positions could be relatively easy for some of those displaced but much harder for others, and it’s possible that AI advances could leave many behind and create a new permanent underclass. Historian, philosopher, and bestselling author Yuval Noah Harari believes it’s quite possible AI will lead to the development of a “useless class” — billions of people who are unemployable. In a Guardian interview, he said: “If they want to continue to have a job, and to understand the world, and be relevant to what is happening, people will have to reinvent themselves again and again, and faster and faster.” Otherwise, there is UBI. In a recent New York Times story, Harari explained why Silicon Valley is supportive of UBI. “The message is: ‘We don’t need you. But we are nice, so we’ll take care of you.’”
The stage is now set. On one side is the conventional view that technology revolutions will create many new jobs, and more than offset losses as positions are eliminated by automation. The other view is that this time is different, that we are not just automating labor but also cognition and many fewer people will be needed by industry. Given that many insiders are starting to lean towards the latter, workers really have only two choices: 1) continuously upgrade their knowledge and skills much faster than before or; 2) hope that UBI becomes a reality in time to prevent them from falling into an AI abyss.
Source: VentureBeat
