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Report Predicts That As Many Jobs Will Be Created As Are Lost By Artificial Intelligence (AI)

A report by accountants, Price Waterhouse Cooper (PwC), predicts that as many jobs will be created by artificial intelligence (AI) as are lost.

AI, according to Klaus Schwab, is part of the fourth industrial revolution/second machine age. The fourth industrial revolution builds upon the third (i.e the digital revolution), which began during the 1980’s, in which the world moved from analog technologies and mechanical devices to digital technology (i.e. characterised by advances such as personal computers, mobile phones, the internet, and IT). The fourth industrial revolution will, says Schwab, involve the fusion of physical, digital, and biological technologies, brought about by advances in nanotechnology, robotics, quantum computing, biotechnology, 3D printing, blockchain, the internet of things (IoT), autonomous vehicles, and yes – artificial intelligence. Schwab asserts that this industrial revolution is greater in scale, impact, and complexity than anything that has proceeded it, and will have a profound impact on all areas of society. It will even challenge previous concepts about what it is to be human. AI, moreover, is already having an impact in terms of super-computers, drones, wearable sensors, virtual assistants, 3D printing, and DNA sequencing. Moreover, nanomaterials and 3D printed livers ready for transplant are already in development.

The PwC Report: The Impact Of Artificial Intelligence (AI) On Jobs

In their report, PwC state: “AI and related technologies such as robotics, drones and driverless vehicles could displace many jobs formerly done by humans, but will also create many additional jobs as productivity and real incomes rise and new and better products are developed. We estimate that these countervailing displacement and income effects are likely to broadly balance each other out over the next 20 years in the UK, with the share of existing jobs displaced by AI (c.20%) likely to be approximately equal to the additional jobs that are created.”

Nevertheless, whilst the overall impact on jobs of artificial intelligence (AI) will be broadly neutral according to PwC, there will be “winners and losers“. The sector that is likely to see the largest net reduction in jobs is manufacturing, with a 25% fall. Transport and storage will also sustain a large reduction of 22%, whilst public administration is projected to see a decline of 18%. On the other hand, the sector of the economy that will benefit most from an increase in employment will be health, which will see a 22% rise. Other sectors that will be benefit include professional, scientific and technical services, with a rise of 16%. Education will also witness a rise, with an increase of 6%. However, PwC predict that there will be regional disparities, in that whilst London will see a net increase in jobs, the North and the Midlands will witness a net fall.

Commenting on these findings, John Hawkesworth, chief economist at PwC stated that: “Healthcare is likely to see rising employment as it will be increasingly in demand as society becomes richer and the UK population ages. While some jobs may be displaced, many more are likely to be created as real incomes rise and patients still want the ‘human touch’ from doctors, nurses and other health and social care workers. On the other hand, as driverless vehicles roll out across the economy and factories and warehouses become increasingly automated, the manufacturing and transportation and storage sectors could see a reduction in employment levels.

As with any prediction, PwC warn that there are many uncertainties. Nevertheless, they state that if the UK is to maximise the potential benefits of artificial intelligence (AI), then they make the following recommendations:-

  • Greater investment in research funding
  • Keeping markets competitive to ensure that consumers benefit from productivity gains
  • Increased investment in the retraining of older workers
  • Greater investment in schools and universities in science, technology, engineering, art & design, and maths (STEAM) skils

Reaction To The PwC Report

Euan Cameron, UK artificial intelligence leader at PwC, states that: “It’s likely that the fourth industrial revolution will favour those with strong digital skills, as well as capabilities like creativity and teamwork which machines find it harder to replicate.” Demand for new jobs will increase in sectors “that require a human touch and aren’t so easy to automate” adds PwC’s chief economist, John Hawkesworth. Matt Walmsley, EMEA Director at Vectra, also points out that: “AI is already changing the workplace, and in some areas creating new work opportunities. For example, in the uniquely adversarial world of cybersecurity, we’re seeing that AI is addressing a significant professional skills and resource gap and is reducing the barrier to entry to the cybersecurity profession. We are seeing enterprises actively deploying AI platforms to support junior staff in front-line cybersecurity operations roles. In some cases, even utilising graduate program interns. AI helps these less technically experienced, but still savvy staff, to teach on the job and augment them with intelligent supporting technology.” Meanwhile, Mayur Pitamber of Insight, contends that: “Fears of mass job displacement by Artificial Intelligence (AI) are simply not realistic – the technology has intelligence, but not wisdom, and that limits what it can accomplish by itself. The real impact of AI on the employment market over the next few years will be to shift people from one role to another, and to create new roles. This migration does not represent a great rupture in the jobs market, but a continuation of what has always happened with new technologies that automate tasks, going back to the first industrial revolution.” This view is supported by Adam Maskatiya, UK general manager at Kasperksy Lab, who asserts that: “There is a massive wealth of opportunity with the implementation of Artificial Intelligence in terms of the jobs it will create, but there is also the need to ask some searching questions – and to consider some of the operational difficulties of AI in use, as well as the ethical and legal issues as to who bears responsibility for the actions of an autonomous or intelligent machine.”

Back in November 2017, the Government announced a new national retraining partnership with industry and unions, as part of its new industrial strategy. This will include a £30 million investment in testing the use of AI and education technology (EdTech) in online digital skills courses. Nevertheless, the coherence of the Government’s industrial strategy has not been without criticism.

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