Artificial intelligence will replace almost 40% of global jobs: IMF

The impact of artificial intelligence (AI) on the global job market could be significant, according to a report by the International Monetary Fund (IMF), published on Monday, which estimated that AI could replace up to 40% of jobs worldwide. The report also suggests that AI has the potential to boost global growth and increase incomes globally.

“In most scenarios, AI will likely worsen overall inequality, a troubling trend that policymakers must proactively address to prevent the technology from further stoking social tensions,” IMF Managing Director Kristalina Georgieva said in a blog post. 

In advanced economies, the figure rises to 60% of jobs that could be affected by AI. Approximately 30% of jobs in these economies are predicted to benefit from AI, while another 30% could see AI executing these roles at the same level. This means that in jobs where AI can perform the same tasks, there may be reduced hiring, lower wages, weaker labor demand, and in some cases, the elimination of certain job roles. In emerging and low-income economies, the risk of AI exposure to jobs is 40% and 26% respectively. This highlights the potential impact on these economies and the need for careful consideration of AI implementation.

The report further suggests that individuals who can utilize AI in their work can expect increased productivity and higher wages, while those who cannot may face challenges. This could lead to older workers struggling to adapt and commanding lower salaries, while younger generations take advantage of more opportunities.

To be sure, according to Capgemini's latest report on 2024 investment priorities published today, business leaders are increasingly recognising the value of AI and generative AI, with 90% of Indian CXOs planning increased investment in these technologies in the next 12-18 months. Of them, 58% view generative AI as an opportunity to boost revenue and innovation.

Nonetheless, others argue that AI cannot totally replace our jobs, stating that there are some areas where AI is surpassing human capabilities — but there are several it can’t replace. A study published in November by Pearson and ServiceNow for example, said that AI and automation will create a demand for 4.7 million new tech jobs, while also creating a need for over 16 million workers in India to reskill and upskill by 2027. 

Simultaneously, the country’s digital skill ecosystem is expected to grow with increased demand for roles like application developers (75,000), data analysts (70,000), platform owners (65,000), product owners (65,000), and implementation engineers (55,000) by 2027 to meet the tech deficit. 

IMF analysts believe that it is crucial to develop a set of policies that can safely leverage the vast potential of AI for the benefit of humanity. The European Union reached a tentative deal in December on legislation setting out safeguards on AI, and the US is still weighing its federal regulatory stance.

Currently, there are no specific laws in India with regard to regulating AI and IT minister Ashwini Vaishnaw said that the Centre is not planning to regulate the growth or set any laws for AI in the country, the government is looking into the examples of how other countries are moving towards regulatory frameworks for AI as it is working on preparing India’s own framework to regulate the technology.