AI will impact 60% of jobs in advanced economies, IMF warns

The International Monetary Fund (IMF) warned that artificial intelligence is poised to transform a majority of work in developed economies as the looming job shift. In a statement on Monday, IMF Managing Director Kristalina Georgieva said at the World Economic Forum in Davos, Switzerland that AI will impact 60 percent of jobs in advanced economies, AFP reported.

The International Monetary Fund (IMF) has issued a warning that artificial intelligence (AI) is on the verge of reshaping a significant portion of work in developed economies, leading to potential job transformations. In a statement made on Monday at the World Economic Forum in Davos, Switzerland, IMF Managing Director Kristalina Georgieva expressed that AI is expected to impact around 60 percent of jobs in advanced economies, as reported by AFP.

Georgieva highlighted the findings of an IMF report published on Sunday, stating, “Advanced economies, including some emerging markets, are projected to witness an impact on 60 percent of their jobs.”

She further added that this figure decreases to 40 percent for emerging markets and 26 percent for low-income countries, according to the IMF report. The overall report indicates that nearly 40 percent of global employment is exposed to the influence of AI.

“And then it goes down to 40 percent, for emerging markets, 26 percent for low-income countries,” she added

The IMF report outlines that half of the jobs affected by AI may face negative consequences, while the remaining portion could experience improved productivity due to AI advancements.

Georgieva, in an interview with AFP, emphasized the dual nature of AI’s impact on jobs, stating, “Your job may disappear entirely – not a favorable outcome – or artificial intelligence may enhance your job, leading to increased productivity and potentially higher income levels.”

While the initial impact of AI is anticipated to be lower in emerging markets and developing economies, the benefits of this technology are also less likely to reach these regions, according to the IMF. The report suggests that this could widen the digital divide and income disparities among countries, with older workers being more susceptible to the changes brought about by AI, AFP reported.

Georgieva sees an important role for policy measures in addressing these concerns, stating, “We must focus on helping low-income countries, in particular, to adapt quickly and seize the opportunities presented by artificial intelligence.”

Acknowledging the challenges posed by AI, Georgieva adds a note of optimism, saying, “So artificial intelligence, yes, it’s a little scary. But it is also a tremendous opportunity for everyone.”

The IMF’s warning aligns with similar concerns raised by other entities. Goldman Sachs, in an April 2023 report, suggested that AI has the potential to replace a staggering 300 million full-time jobs. The World Economic Forum’s Global Risks Report 2024 also addresses these concerns, predicting job growth over the next five years based on survey responses and labor market statistics from the International Labour Organization.

“We must focus on helping low-income countries in particular to move faster to be able to catch the opportunities that artificial intelligence will present,” she said. “In other words, embrace it, it is coming,” she added. “So artificial intelligence, yes, a little scary. But it is also a tremendous opportunity for everyone.”

The influence of AI on our future is monumental. As mentioned earlier, we reported that tech companies, utilizing AI tools such as ChatGPT and Google Bard, have managed to lay off over 7,500 employees in the first two weeks of 2024 while still achieving increased productivity. Remarkably, despite these layoffs, these companies have seen a boost in efficiency plus cost savings.

This marks a departure from past technological revolutions that primarily affected blue-collar jobs; now, AI is presenting a potential threat to white-collar positions. The landscape is evolving, and the impact of AI on employment is a critical aspect to navigate in the coming years.