Hewlett Packard Enterprise (HPE) has released new research which states redundancies are okay because more jobs will be created. But, how many of these new jobs will be offered to those shivering in the dole queue?
Here are some points which few in the industry will argue with. Firstly, AI will enable new business models, products and services, which will help certain companies grow. Secondly, certain national economies will grow thanks to increased profitability realised through operational efficiency. Finally, new jobs will be created as a result of organizations implementing these technologies.
These points are reinforced in the research, respondents expect to grow their revenues 11.6% by 2030 as a result of AI adoption, while participants on average plan to invest 0.48% of their revenue in AI in the next 12 months. There is clearly a surge towards AI which is irreversible. The issue we have right now is no-one willing to accept there will be pain.
The world of efficiency and profitability is cut-throat. Throughout history, business owners have sought new ways to reduce the impact of a company’s biggest overhead, its workforce, and AI is just another step in this quest. HPE believes AI will create jobs, and we do not disagree, though the claim these jobs will outweigh the redundancies is dubious (at best).
Two thirds of respondents expect that new jobs created by AI will balance or outweigh the number of jobs made redundant by AI. In our opinion, these people are either incredibly optimistic or dangerously naive. The promise of AI has been to free up employee time by removing the monotonous tasks, though we suspect there will be numerous business owners and CEOs who will use the technology to reduce headcount instead of searching for new value. Even if the respondents are being genuine, the research does not take into account disruption. Here, Amazon is an excellent example.
Cashier-less supermarkets is an experiment from Amazon which is gaining quite a bit of attention. Should this idea take hold with Amazon finding profitability in the venture, it will be scaled. With the cut-throat nature of the Amazon machine, it would challenge the traditional industry, undercutting due to the lesser employee expenses. If Amazon’s supermarkets become popular with the general public, revenues will be squeezed in the traditional supermarkets, sites will be closed and people will be unemployed. Unfortunately, the disruptor cannot offer these people any employment opportunities. This is the price of efficiency.
This is the big issue which the industry faces. AI will create new jobs, but will those who are being made redundant qualified for them? Will a company like Pepsi or Tesco hire an unemployed customer service agent or former cashier for the newly created coding and data scientist jobs, or will they look to the technology orientated universities?
At some point the industry will have to take ownership of the logical chain of events. AI will help companies grow and capture new revenues, but efficiency and industrial revolutions are painful processes for certain segments of society; this is an unavoidable truth. The sooner industry and governments recognise progress has a nasty side, the better the transition can be managed through effective reskilling initiatives.