A recent analysis by the International Monetary Fund (IMF), reported by Bloomberg, indicates that artificial intelligence (AI) is expected to affect nearly 40% of jobs globally, with advanced economies bearing a larger share of the consequences compared to emerging markets and low-income countries.
IMF Managing Director Kristalina Georgieva, in a blog post, highlighted that, in most scenarios, AI is likely to worsen overall inequality. She emphasized the need for proactive measures by policymakers to prevent AI technology from exacerbating social tensions. Georgieva stated that the impact on income inequality will depend on how well AI complements high earners, potentially widening the wealth gap through increased productivity from high-income workers and companies.
Georgieva urged countries to implement “comprehensive social safety nets” and retraining programs for vulnerable workers to mitigate the potential negative effects of AI on the job market.
The IMF report, published on January 14, projected that advanced economies might witness about 60% of jobs affected by AI, surpassing the impact on emerging and low-income countries. However, the report noted that only half of the jobs affected by AI would face negative consequences, with the rest potentially benefiting from enhanced productivity gains due to AI integration.
Georgieva’s comments align with discussions at the World Economic Forum in Davos, where global leaders are deliberating on AI. The report acknowledged the concerns raised by companies investing heavily in AI, such as Buzzfeed Inc., which utilizes AI for content creation and restructuring its news department.
While the European Union has reached a tentative deal on AI legislation, the United States is still considering its federal regulatory stance on the matter.
The IMF report predicts that emerging markets and developing economies will experience a smaller initial impact from AI on labor markets but are also less likely to benefit from the productivity gains that AI integration may bring. Georgieva stressed the importance of helping low-income countries seize the opportunities presented by AI.
While acknowledging the potential challenges of AI, Georgieva emphasized its tremendous opportunity for everyone. She highlighted the need for an AI-related productivity boost to sustain global economic growth, underscoring the importance of unlocking productivity for a positive global narrative.
The IMF is expected to publish updated economic forecasts later this month, indicating that the global economy is broadly on track to meet previous projections. However, Georgieva cautioned that 2024 is likely to be a “very tough year” for fiscal policy worldwide due to countries addressing debt burdens from the Covid-19 pandemic and managing depleted buffers. She expressed concerns that governments facing elections might be pressured to increase spending or cut taxes, potentially undermining progress made in the fight against high inflation. Source: The Business Standard
