Impact of AI on Global Labour Market

According to the IMF, AI has the potential to boost global productivity and growth, but may also displace jobs and worsen inequality. Let’s explore the findings in more detail:

Global Impact of AI

IMF economists predict that almost 40 percent of jobs globally are susceptible to automation or augmentation by AI. This has implications for both advanced and emerging economies.

AI’s Impact on Advanced Economies

• Around 60 percent of jobs in advanced economies may be impacted by AI.
• About half of those jobs could benefit from AI integration, enhancing productivity.
• For the remainder, AI may execute key human tasks, lowering labour demand, wages, and hiring.

AI’s Impact on Emerging Economies

• In emerging and developing economies, AI exposure is predicted to be 40 percent and 26 percent respectively.
• This suggests fewer immediate AI disruptions compared to advanced economies.
• However, many emerging markets lack the infrastructure and skills to harness AI’s benefits, potentially worsening inequality over time.

AI and Inequality

The IMF warns that AI may drive inequality within countries. Workers able to exploit AI may become more productive and boost wages, while those who cannot fall behind. Research also shows that AI can accelerate the productivity of less experienced staff, potentially benefiting younger workers more than older workers.

AI Preparedness

The IMF has introduced an AI Preparedness Index to evaluate readiness in areas such as digital infrastructure, human capital, innovation, and regulation. Wealthier economies have shown higher preparedness for AI adoption.

Policy Priorities

For advanced economies, priorities include innovation, integration, and regulation to cultivate the safe and responsible use of AI. For emerging markets, the priority is to develop digital infrastructure and skills.

Conclusion

The AI era has arrived, and proactive measures are crucial to ensuring its benefits are shared prosperity for all.