IMF warns AI set to impact 40% of jobs globally

The analysis comes amidst growing concerns over AI's role in the global workforce, with its potential to both enhance and disrupt current job markets. While AI is expected to boost productivity in certain sectors, it also threatens to replace human-performed tasks, potentially leading to lower demand for labour, wage impacts, and job losses.

O’ReillyVP of Emerging Tech Mike Loukides focuses on the more positive aspects of this report: “While there's been no shortage of predictions about job loss, I doubt that will happen at any scale worth thinking about. ChatGPT will enhance employees' skills, whether they're sales reps, copywriters, or programmers; it will make them better at their jobs, and hopefully minimise some of the tasks that they least like doing. They'll become more effective, with 10-30% increases in productivity and they'll be able to give their employers a way to get ahead of their competition, but also not enough to result in mass unemployment. “

The analysis estimates 60% of jobs are to be affected by AI in advanced countries, with only 26% of jobs in low-income countries feeling the AI wave - primarily due to limitations in infrastructure and skilled workforce.

The situation is exemplified by British telecom giant BT's recent announcement to employ AI in cutting a fifth of its 55,000-strong workforce by the end of the decade. This move has sparked debates over the emerging wave of AI-induced job cuts, with companies like Challenger, Gray, & Christmas, Inc, already reporting nearly 4,000 layoffs attributed to AI technologies.

The gender disparity in AI's impact is another point of concern. A government report highlights that women and disadvantaged groups are more at risk, with clerical roles—largely occupied by women—being particularly vulnerable. This calls for strategic interventions to ensure that existing inequalities are not exacerbated.

Investment bank Goldman Sachs last year also released a report outlining the dual nature of AI's economic impact. While it predicts the potential replacement of about 300 million jobs in the EU and US, it also foresees a surge in productivity and the emergence of new job sectors. The UK government, echoing this sentiment, emphasises AI as a productivity driver, with Technology Secretary Michelle Donelan advocating for AI to complement rather than disrupt the UK workforce.

However, concerns remain about the broader effects of AI on wages and employment dynamics. Carl Benedikt Frey of Oxford University warns of potential wage reductions in sectors like journalism due to increased competition fuelled by AI. Similarly, Mike Loukides from O'Reilly points out the risk of widening gaps between junior and senior staff, underscoring the need for developing new skills to use AI tools effectively.

These concerns last year boiled over into action, with the EU drafting the world's first 'comprehensive' laws aimed at AI. Equally, global leaders gathering at the World Economic Forum in Davos will discuss AI in depth as the conversation around its impact on jobs gains momentum.