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14 June, 2024
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Forty percent of global jobs face disruption because of AI

IMF report reveals AI's potential impact on global wealth


Artificial intelligence (AI) is poised to reshape the global job market, potentially affecting 40% of jobs worldwide, according to the head of the International Monetary Fund (IMF), Kristalina Georgieva.

As reported by The Guardian, the IMF's analysis reveals that advanced economies, including the US and UK, face greater risks, with approximately 60% of jobs exposed to AI and half of them potentially negatively impacted.

The IMF report identifies two categories of jobs based on their complementarity to AI. Jobs with "high complementarity," such as surgeons, lawyers, and judges, are deemed safer as AI enhances their work rather than displacing it entirely. On the other hand, jobs with "low complementarity," like telemarketing, are more susceptible to displacement by AI.

Georgieva emphasizes the need for countries to establish comprehensive social safety nets and offer retraining programs for vulnerable workers. She warns that AI's impact could lead to lower wages, reduced hiring, and, in extreme cases, the disappearance of certain jobs. The analysis also suggests that AI may worsen overall global inequality and create social tensions without political intervention.

In terms of global AI job exposure, emerging market economies, including China, Brazil, and India, face a 40% exposure rate, while low-income countries have a 26% exposure rate. The IMF's findings underscore the importance of addressing these challenges on a global scale.

Generative AI, which produces highly plausible text, images, and voice from simple prompts, has gained prominence in political discussions. Tools like the ChatGPT chatbot are contributing to the evolving landscape of AI technology.

The IMF report predicts that higher-wage earners with jobs highly complementary to AI may experience an increase in income, potentially leading to heightened income and wealth inequality. Choices made by countries regarding AI property rights, redistributive policies, and fiscal strategies will shape the overall impact on income and wealth distribution.

While the UK, with its high proportion of graduates, may be better positioned to transition to jobs with high complementarity to AI, challenges may arise for older workers adapting to new roles or retraining.

Last year, the Organisation for Economic Co-operation and Development (OECD) identified highly skilled jobs as the most vulnerable to AI-driven automation, representing about 27% of employment across its member countries.

As AI continues to advance, discussions around its impact on the global economy, inequality, and job displacement are expected to take center stage at events like the World Economic Forum in Davos, where top executives from the tech industry convene to address these critical issues.

[With information sourced from The Guardian]

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