What impact will AI and robots have on global trade?
Robotics, artificial intelligence (AI) and machine learning have radically transformed the productivity of emerging economies around the world. AI is improving efficiencies in industries from transportation and finance through to energy management. On top of that, the autonomous Internet of Things (IoT) is helping to create a 24/7-connected world that allows consumers and businesses to talk with one another. So, what’s the big issue?
Is AI Replacing Jobs?
A recent study by the Pew Research Center found that almost half (48 percent) of industry experts surveyed predict a future in which robots and digital agents will “displace significant numbers of both blue — and white — collar workers,” resulting in income inequality and social disorder.
While it’s true that machines have replaced human labor since the 20th-century Industrial Revolution, the pace of change ramped up in recent years. More than a third (35 percent) of the current employment in the U.K. may be at high risk of being replaced by machines in the next 20 years. Although technology can transform the speed and availability of goods and services, will consumers be so keen to buy products and services made and provided solely by robots?
In some industries, the implementation of AI and machine learning is a numbers game. Robots, which can operate all day without interruption, are more productive and profitable to companies than human employees. Thus, the concern for the globalization train is not necessarily that machine automation will result in poorer goods and services, but the speed of its encroachment on human jobs could hit society hard. Jason Furman, former chairman of the Council of Economic Advisers, said in 2016 that AI “could lead to sustained periods of time with a large fraction of people not working.” A rise in unemployment would lead to a lack of consumer spending, which could, in turn, put companies at risk.
Amid this torrent of fearmongering, there are some people who believe the real impact of AI on international commerce will be a significantly positive one. While AI and machine automation is likely to change the face of employment in the next decade or two, there will be some industries where automation will merely supplement human efforts rather than replacing them. It’s hard to imagine AI replacing doctors and surgeons in the healthcare sector, nor is it likely that robots will displace teachers.
It’s important to remember that the number of robots and AI machines will rise in the years to come, so, too, will the number of job vacancies to look after them. To date, robots are unable to take care of themselves and require periodic human intervention to continue to operate at an optimum efficiency. That means that jobs created for humans to manage and refine robots at all stages of the AI journey.
Whether it’s developing and testing new robots or programming new commands, machines still can’t function properly without the continual attention from human staff. Indeed, a study of almost 1,000 companies implementing AI demonstrated the growth opportunity of machine automation, helping to dispel fears that job losses will outweigh job creation. Even further, 80 percent of all the organizations surveyed said adopting AI created more jobs.
The last time society encountered such a rapid shift in employment came when mass electrification and road vehicles and telecommunications reared their head. Of course, it’s easy to understand that as society evolved its habits, norms and routines to the existing way of doing things. However, the new industrial revolution will result in a significant upheaval before we find our equilibrium once more.
The big issues facing governments and policymakers worldwide is how to tackle the issue of low-skilled workers that do lose their jobs to AI and machine automation. It seems likely that the evolution from a labour-based economy to an AI and robotic-dominated economy requires a taxation package to protect unemployed workers in the short-term and give them the chance to retrain as part of the new age of global commerce. Might we even see robots and automated programs being taxed, too? It could raise enough funds for governments to soften the transition to the digital era.