Kristalina Georgieva emphasizes the importance of countries establishing social safety nets to mitigate the impact on workers
The head of the International Monetary Fund asserts that artificial intelligence will impact 40% of global jobs. Stressing the “crucial” need, the IMF chief highlights the importance of countries establishing social safety nets to alleviate the effects on vulnerable workers. The term AI, denoting computer systems performing tasks associated with human intelligence, is expected to significantly reshape the global economy, with advanced economies facing heightened risks of disruption.
The IMF, serving as the lender of last resort internationally, reports that approximately 60% of jobs in advanced economies like the US and UK are susceptible to AI exposure, with around half of them potentially facing negative impacts. However, the technology is anticipated to boost productivity for certain individuals as AI enhances their performance, according to the analysis.
As per the IMF, jobs highly exposed to AI are safest when they exhibit “high complementarity,” signifying that the technology aids rather than completely replaces the work. This category encompasses roles with significant responsibility and human interaction, such as surgeons, lawyers, and judges.
Jobs with high exposure but “low complementarity,” indicating a higher risk of displacement by AI, include telemarketing or cold-calling for goods and services. The IMF noted that low-exposure occupations encompass dishwashers and performers.
AI job exposure stands at 40% in emerging market economies—defined by the IMF as states like China, Brazil, and India—and 26% for low-income countries, resulting in an overall total of just under 40%, according to the IMF.
Generative AI, denoting technology capable of generating highly plausible text, images, and even voice from simple hand-typed prompts, has gained political prominence since the emergence of tools like the ChatGPT chatbot.
Kristalina Georgieva, the IMF managing director, highlighted that AI’s impact on highly skilled jobs poses greater risks to advanced economies. She added that in extreme cases, some jobs in major economies could potentially disappear.
Georgieva noted in a blog post accompanying the IMF research that approximately half of the exposed jobs could experience benefits from AI integration, leading to enhanced productivity. However, for the other half, AI applications might take over crucial tasks currently performed by humans, potentially reducing labor demand, resulting in lower wages and diminished hiring. In the most extreme cases, certain jobs may even disappear.
She further emphasized that in most scenarios, AI is likely to exacerbate overall inequality across the global economy and could fuel social tensions without political intervention. AI is anticipated to be a prominent topic of discussion at the World Economic Forum in Davos this week, where top executives from the tech industry are expected to participate.
Georgieva emphasized the necessity for countries to establish comprehensive social safety nets and provide retraining programs for vulnerable workers. “In doing so, we can make the AI transition more inclusive, protecting livelihoods and curbing inequality,” she stated.
The IMF analysis indicates that higher-wage earners in jobs with high complementarity to AI may experience an income increase, contributing to a rise in inequality. The IMF report highlights, “This would amplify the increase in income and wealth inequality that results from enhanced capital returns accruing to high earners.” It underscores that countries’ decisions regarding the definition of AI property rights, along with redistributive and other fiscal policies, will ultimately shape its impact on income and wealth distribution.
The report indicated that workers in the UK, given its high proportion of graduates, may be more adept at transitioning from jobs at risk of displacement to those with “high complementarity.” However, older workers might encounter challenges adapting or shifting to new roles or retraining.
Satya Nadella, the CEO of Microsoft, the largest investor in OpenAI, the US company behind ChatGPT, mentioned on Monday that there would be jobs in the future, but uncertainties remained about the “shape of these jobs.” Speaking at an event hosted by the Chatham House thinktank in London, Nadella expressed that AI could assist with “mid-career transitions.” He added, “I think this is the age where this is about expertise at your fingertips. So if anything, anyone can become an expert in anything because you have the AI assistant helping you.”
In the previous year, the Organisation for Economic Co-operation and Development (OECD) declared that highly skilled jobs faced the highest risk from AI-driven automation. These occupations constituted approximately 27% of employment across the OECD’s 38 member countries, encompassing the UK, Japan, Germany, the US, Australia, and Canada. The report emphasized that skilled professions like law, medicine, and finance were particularly vulnerable to automation.
