[Warning – long post but worth the read!]

I’m sure you’ve heard of Generative Artificial Intelligence or AI, but just in case you haven’t, below is a quick and simple definition:

A broad label that’s used to describe any type of artificial intelligence (AI) that can be used to create new text, images, video, audio, code or synthetic data (input that is generated mathematically from a statistical model).

As it continues to grow in popularity and demand, I’ve paid more attention to the impact it’s having on the labor market:

• Self checkouts at the grocery store
• Fully automated restaurants (yes, McDonald’s is experimenting!)

This got me to thinking, how will AI continue to expand and how will it affect jobs in the short-term and long-term? I started doing some research and it’s been eye-opening.

Below is a summary of some of the information I’ve found. It’s long so be patient, but I think it’s critical for you to read because AI is here and it’s here to stay!

What’s Up With AI?

• While artificial intelligence has been around for decades, the rise of generative artificial intelligence (AI) and its potential economic impacts have been all over the headlines ever since the release of OpenAI LLC’s ground-breaking ChatGPT software back in November 2022.
• What sets generative AI apart from its predecessors is that, unlike traditional AI systems that are primarily used to make predictions based on detected patterns, this wave of the technology is able to generate new content (text, images, audio, etc.). That said, the current phase of generative AI is only able to perform a small subset of tasks to the same degree of efficiency and accuracy as humans. But, if the trend of improving tech continues along the predicted path, many experts in the field believe that by 2060, AI capabilities will have surpassed human cognitive power.
• 63 per cent of those polled in PricewaterhouseCoopers LLP’s annual Global CEO Survey believe that AI will have a greater economic impact than the internet.

The Bad Side

• There is no denying that one side effect of generative AI becoming more ubiquitous is labor market displacement, and potentially higher levels of unemployment on the horizon.
• Goldman Sachs has estimated one-quarter of all tasks will be exposed to AI takeover, putting 300 million full-time positions globally at risk of automation. For the U.S. specifically, the prediction is that 63 per cent of the corporate sector will see almost half its workload affected by AI. Only 30 percent will emerge unscathed (primarily jobs involving physical labor and human touch elements), while seven per cent will undergo complete replacement. And seven per cent of a U.S. workforce that totals 160 million is not a small number.
• The harmful and beneficial effects of the technology will not be felt evenly across the labor market, meaning workers in some industries stand to lose out while others gain.
• The bottom line is that productivity will undoubtedly receive a boost — as bots are increasingly able to perform repetitive and time-consuming tasks with human-level speed and accuracy (or greater) — but the labor displacement among many white-collar jobs is likely to be a painful casualty of the shift. This is where the greatest upheaval is going to be — on the labor market.

 The Good Side

• Technology makes up for areas we lack. Most of us use tools like search engines (Google, Siri, or Alexa) to make our research efforts more effective. Modern AI will only increase the ways technology can augment our abilities.
• Similar to the calculator – where humans can make calculations, but it is accepted that a calculator does it faster and more accurately – AI tools reduce or improve the outcomes of repeatable processes or tasks. The benefits of it include the visual expression of what users are thinking – i.e., it can bring a unique or novel idea to life visually. Previously, if you were not an artist or a graphic designer, your options to create a visual representation would require partnership with an artist to create your idea. But now, the tool is accessible to anyone who has a computer and it’s not limited to those who have an artist on staff.
• Theoretically, with the systems performing mundane and repetitive tasks on behalf of humans, more time can be freed up to take on additional projects that involve a higher degree of skills and creativity.
• New job functions, responsibilities and titles are being created at an unprecedented pace because of the impact of AI, machine learning and other technology.
• It should be noted, on a more optimistic note, that the internet sparked similar fears several decades ago, and ended up creating millions of jobs in the United States and now accounts for 10 per cent of the nation’s GDP.
• On the conservative end, Goldman Sachs Group Inc. estimates that global gross domestic product will rise by seven per cent over a 10-year period due to the technology. In contrast, researchers at the World Economic Forum are calling for a larger 26 per cent boost to global economic output by 2030
  (amounting to US $15.7 trillion — larger than China and India’s GDP combined).

Which Jobs Will Be Affected the Most?

• Roles that include manual processes that can be easily automated will be at risk and have been for a while now). For example, if you work at a bank and your primary role is taking deposits, digital banking will continue to decrease the number of tellers needed.
• While blue-collar workers bore the brunt of the impact in previous waves of technological advancements, white-collar workers look set to be more heavily displaced this time around, with data entry, administrative support, accounting, mathematicians, and financial services topping the list of most affected professions.
• There will be roles for engineers to build the AI, but there will also be many roles on how to manage, improve and use the results of the technology.
• With the recent advancements in writing and visual representation brought about by ChatGPT and DALL·E 2, roles that involve research, writing summaries or templates, or creating visual designs will decline. But roles that require insights and interpretation after reviewing research summaries or weaving visual ideas together to make a campaign or create a persuasive presentation, will increase. Engineers will continue to flourish, but so will the roles that incorporate, interpret, analyze and customize the output of AI technology.

Conclusions

• “As artificial intelligence chatbots like ChatGPT become more powerful and widely available, they will likely affect labor market outcomes. Depending on the roles and industries, we can expect algorithms to either complement workers’ competencies and increase their productivity or reduce the employability of humans altogether,” notes the Brookings Institute.
• The best way to take advantage of these future options is to build an understanding and comfort with how AI and other technology intersect with current business processes.
• The future of work has ample opportunity, provided workers embrace a growth mindset toward where technology can take us. A key to building a lasting career continues to be a balance between performing well in the roles that are available with an eye toward incorporating future trends and innovations. Those that embrace the forward momentum of technology will continue to be in demand.

Ultimately, whether the overall effects on the global macroeconomic economy are positive or negative on net following the wave of generative AI remains to be seen. While productivity is sure to gain, the question mark surrounding the effects on the labor market is what is really important, both for the economy and for society.

Until next time….