A swathe of recent research shows many believe the rollout of artificial intelligence (AI) will result in job losses and industry disruption.
In a new blog Kristalina Georgieva, managing director of the International Monetary Fund warned that almost 40% of global employment is exposed to AI.
While automation and IT have tended to affect routine tasks, Georgieva believes AI has the ability to impact high-skilled jobs. In advanced economies Georgieva said that the IMF’s new Gen-AI: Artificial Intelligence and the Future of Work report predicts that about 60% of jobs may be impacted by AI. Although the IMF expects about half the exposed jobs may benefit from AI integration and enhancing productivity, for the other half, AI applications may execute key tasks currently performed by humans. This, says Georgieva, could lower labour demand, leading to lower wages and reduced hiring.
In fact, PwC recently reported that a quarter of CEOs expect AI will lead to a 5% reduction in the size of their workforce.
Meanwhile, interest in large language models like ChatGPT appears unstoppable. According to learning platform provider, O’Reilly, there has been an unprecedented surge of interest in generative AI among developers, increasing 3,600% year over year.
CEOs and CFOs may want to have a close look at what credit rating agency Moody’s has to say. It predicted that over the next two years only software and semiconductor companies will see a material effect on credit quality stemming from AI adoption and implementation. But beyond 2026, the impact will be much broader. In its 2024 AI Outlook report, Moody’s predicted that sectors like legal services and business process outsourcing will be materially impacted by the increase in adoption of advanced AI.
There are numerous challenges for any CIO, tasked with developing an advanced AI strategy for business with the risks. Lack of a coherent strategy is not really an option, especially given the industry hype and availability of plenty of off-the-shelf products that can help IT leaders get going.
But to be truly transformative, AI systems need to understand the work people do. This requires cooperation with the very people who will probably feel their job is at risk if they reveal everything. “There are going to be some roles that I think will no longer be needed or will be done very differently going forward,” says Sandy Venugopal, the former CIO of Uber, who is now CIO at SentinelOne. “I think we need to be ready to acknowledge and help people in those affected areas to be ready for the change that’s coming. That’s part of our responsibility.”
With this in mind, CIOs should regard their role as responsible leaders, to ensure AI initiatives are run as change management programmes, with a big emphasis on bringing employees along.