AI Creates Opportunities and Anxieties in Workplace
Like a runaway freight train, the global movement towards artificial intelligence (AI) continues to pick up steam. According to Bloomberg Intelligence, global spending on AI technology is expected to reach $1.3 trillion by 2032, compared to just $40 billion spent in 2022. For those of you with your trusty calculator by your side, that equates to a compound annual growth rate of 42% on AI-related spending.
But it’s not just the tech behemoths like Amazon, Apple, Microsoft, Alphabet and Meta that are opening up their vast pocketbooks. Experts find that many companies – both large and small – are quickly incorporating AI technology into their business strategies.
For most Americans, the greatest apprehension over AI is a lack of trust. Many of us have heard countless stories of AI being used for cyberattacks, identity theft, the sale of personal data or to spread disinformation. In a survey my MITRE-Harris, 82% of Americans say they are either somewhat or very concerned about AI being used for malicious intent.
But when it comes to employees and their job security, the anxiety over the encroachment of AI is even greater. In a survey by Bentley-Gallup, 75% of American workers believe that AI will reduce the total number of jobs in the country over the next 10 years. Just 19% say AI will have no impact while 6% say AI will actually increase the number of jobs.
These concerns are not without merit. A study by Goldman Sachs estimates that AI could immediately replace the equivalent of 300 million jobs worldwide. Here in the U.S., the study estimates that roughly two-thirds of all current jobs have at least some tasks that can be performed by AI. Most of these jobs have sizable exposure to AI, where 25%-50% of all tasks can be replaced. The study further indicates that roughly 25% of all current work in the U.S. could be fully replaced by AI.
Though the global AI movement is still in its relative infancy, businesses around the world have been re-affirming their commitment to the use of AI. Not only does AI help them to deliver new products and services to the consumer marketplace, but it has also become an effective tool in reducing operating and labor costs.
In a Gallup survey of Fortune 500 human resource executives, 72% state that AI will likely replace existing jobs within their organizations within the next three years. The executives cite the expected benefits of increased efficiency and effectiveness, greater speed and better decision-making. They also contend that AI will allow employees to focus less on remedial tasks and more on strategic thinking.
AI has the potential to be a very disruptive force for change. On the positive side, that change can bring tremendous advancements in science, medicine, research & development, engineering and finance, among others. Along the way, however, those disruptions will likely extend to employees and the broader labor market.
Mark M. Grywacheski, Investment Advisor
Quad Cities Investment Group is a Registered Investment Adviser.
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