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AI could replace 300 million jobs in the U.S. and Europe, soon

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Are we ready for the era of Artificial Intelligence (AI)? It will likely be bigger than the birth of the internet. Some say, much bigger.

According to a Goldman Sachs report, AI has the potential to substitute up to 300 million full-time jobs – a quarter of work tasks – in the U.S. and Europe, leading to significant changes in global employment patterns and trends.

However, it may also mean new jobs and a productivity boom and increase the total annual value of goods and services produced globally by 7%.

Job prospects

The government of the UK is actively encouraging investment in AI and believes that this technology could lead to improved productivity. In order to ease public worries, they are attempting to provide assurance regarding its effects.

“We want to make sure that AI is complementing the way we work in the UK, not disrupting it – making our jobs better, rather than taking them away,” Technology Secretary Michelle Donelan told the Sun.

According to the recently released report, the effects of AI are likely to vary from one sector to another. As much as 46% of tasks in administrative and 44% in legal professions could be automated, contrary to just 6% and 4%, respectively, in construction and maintenance.

For instance, BBC News recently reported artists’ concerns that AI image generators could impact their jobs.

Wages?

“The only thing I am sure of is that there is no way of knowing how many jobs will be replaced by generative AI,” Carl Benedikt Frey, future of-work director at the Oxford Martin School, Oxford University, told BBC News.

An example of how AI writing assistants are changing the way people write is ChatGPT. This tool allows people with average writing skills to create essays and articles that would otherwise require superior writing skills or take longer to produce.

“Journalists will therefore face more competition, which would drive down wages, unless we see a very significant increase in the demand for such work.

“Consider the introduction of GPS technology and platforms like Uber. Suddenly, knowing all the streets in London had much less value – and so incumbent drivers experienced large wage cuts in response, of around 10% according to our research.”

“The result was lower wages, not fewer drivers.”

A reason for optimism?

Interesting stat…

A recent report has revealed that 60% of jobs that are currently being held by workers did not exist in 1940. This highlights the shift in the professional landscape and how technology has opened up many more opportunities for individuals.

However, some studies have indicated that since the 1980s, technology has been responsible for eliminating more jobs than it has created.

According to the Goldman Sachs study, generative AI applications could also potentially lead to a reduction in employment opportunities in the near future, similar to the aforementioned advances over the last four decades.

It is hard to predict the far-reaching effects of AI in the future.

“We do not know how the technology will evolve or how firms will integrate it into how they work,” chief executive of the Resolution Foundation think tank Torsten Bell told BBC News.”

“… So all firm predictions should be taken with a very large pinch of salt”.

“That’s not to say that AI won’t disrupt the way we work – but we should focus too on the potential living standards gains from higher-productivity work and cheaper-to-run services, as well as the risk of falling behind if other firms and economies better adapt to technological change.”

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