Make no mistake, AI is here to stay and will only grow stronger and more powerful over the coming years. Right from military hardware to financial software packages, all of them now have AI as a key ingredient.
The ripple effects are already being felt, especially on jobs. Global major IBM plans to replace about 7,800 jobs with AI. The company also expects to pause further hiring, especially for roles it thinks could be replaced with AI, and replace around 30 per cent of non-customer facing roles with AI over a five-year period.
Companies across the spectrum of information technology, telecom, BFSI, media and entertainment etc., have started to redesign their global workforce hiring plans with the objective of trimming the jobs that can be substituted with AI.
The computational power of AI has been effectively put to use by fintechs as well. They have smartly used it to automate various elements of the workflow, right from credit appraisal to final sanction and disbursement, all without any human intervention. AI-enabled algorithms based upon machine learning tools can be deployed not just for analysing complex data sets in the field of investment and finance but also in generating reader desired words and sentences and ultimately scripts that publishing entities can incorporate, thereby slashing time and effort expended by the publishing teams, especially editors.
Reskilling may not help
As AI tools become sharper, job redundancy and ultimately loss of employment are inevitable. This doesn’t necessarily bode well for populous nation like India. Pro AI pundits might argue that the job losses that AI creates will enable the laid-off workforce to either re-skill themselves or adapt to a different kind of employment. Reskilling is not a panacea as machines are also adapting through ML (Machine Learning) tools that make them even more effective and disruptive, thereby annexing any leftover areas where the reskilled workforce may try and gain an entry into. Mundane jobs across various industries, especially the services sector, are bound to be automated, but this could lead to disastrous consequences. Every economic solution comes with social consequence.
An overly populated nation like India cannot afford to let the excess labour sink into redundancy. Western corporations will not shy away from using AI tools to gain strategic advantage but that shouldn’t come at the cost of disrupting and displacing a large chunk of the employable masses here. Even the capital rich and labour scarce West have woken up to the perils of AI. Unless a national and state level AI policy is formulated and executed, AI usage would go uncontrolled and unchecked across industries that will ultimately result in major disruptions in India’s labour market. This would lead to the dream of reaping demographic dividend turn into a nightmare.
In 1979, Akio Morita, the legendary Japanese business tycoon and the co-founder of Sony, met with China’s reforms strongman Deng Xiaoping who had asked Morita to help China with the process of robotic automation. Sony’s boss rightly advised Deng against the move, pointing out that China was a big country with a vast population and hence it was in the best interests of China to utilise the labour available in manufacturing and other sectors and not adopt automation blindly. Morita’s advice still holds good.
The writer is Head of Structured Finance with Fedbank Financial. Views are personal