Ear­lier this month, pro­fes­sio­nal ser­vices firm PwC released its latest edi­ti­on of its UK Eco­no­mic Out­look. Tucked in at the end of the report, the­re is a chap­ter on what effect AI and auto­ma­ti­on are going to have over the next twen­ty years.

 

The­re are a num­ber of head­line dis­co­ve­ries. First­ly, the over­all chan­ge is expec­ted to be lar­ge­ly neu­tral, alt­hough with a slight gain. The­re will, howe­ver, be a divi­si­on bet­ween indus­tries that will see jobs crea­ted and tho­se that will see roles redu­ced.

As PwC says in the release accom­pany­ing the report: “While the over­all net effect of AI on UK jobs may be broad­ly neu­tral, this varies signi­fi­cant­ly across indus­try sec­tors. The most posi­ti­ve effect of AI is seen in the health and soci­al work sec­tor, whe­re PwC esti­ma­tes that employ­ment could increa­se by near­ly 1 mil­li­on, equi­va­lent to around 20 per cent of exis­ting jobs in the sec­tor. On the other hand, PwC esti­ma­tes the num­ber of jobs in the manu­fac­tu­ring sec­tor could be redu­ced by around 25 per cent, rep­re­sen­ting a net loss of near­ly 700,000 jobs.”

 

Also inte­res­ting is that PwC has revi­sed its esti­ma­te of the pro­por­ti­on of roles dis­pla­ced by AI and auto­ma­ti­on. As the aut­hors admit, “In our pre­vious rese­arch, we esti­ma­ted that 30 per cent of exis­ting jobs were at high risk of auto­ma­ti­on, howe­ver in prac­tice we esti­ma­te the per­cen­ta­ge that will be dis­pla­ced by 2037 is around 20 per cent.”

In con­clu­si­on, the aut­hors wri­te, agree­ing with what we’ve writ­ten on exten­si­ve­ly, “It’s likely that the fourth indus­tri­al revo­lu­ti­on will favour tho­se with strong digi­tal skills, as well as capa­bi­li­ties like crea­ti­vi­ty and team­work which machi­nes find har­der to repli­ca­te.”

 

That’s also an inte­res­ting point, and one that we’ve also writ­ten on. We’ve made clear over the last eigh­te­en mon­ths that the­re are are­as that robots can­not replace humans, but can only but­tress their work.

 

The most-inte­res­ting part of the report looks at the geo­gra­phic effects of AI and auto­ma­ti­on, and this rai­ses a bunch of new ques­ti­ons to be ans­we­red and chal­len­ges to be over­co­me. The big­gest bene­fit wit­hin the UK, accord­ing to the aut­hors, will be in Lon­don, which will see the num­ber of roles increa­sed by 2 per cent. This is becau­se Lon­don is home to more than a quar­ter (28 per cent) of the country’s pro­fes­sio­nal, sci­en­ti­fic, and tech­ni­cal activi­ties, plus near­ly a third (31 per cent) of the infor­ma­ti­on and com­mu­ni­ca­ti­on sec­tor.

In con­trast,” says PwC, “regi­ons in the North and Mid­lands, with some­what hig­her weightings towards rela­tively auto­matable indus­tri­al jobs, have mar­gi­nal­ly nega­ti­ve esti­ma­ted net impacts, but only by around 1 per cent or less of exis­ting job num­bers sin­ce even the­se regi­ons are now domi­na­ted by ser­vice sec­tor employ­ment. Howe­ver, the­re could be lar­ger regio­nal varia­ti­ons lin­ked to fac­tors other than indus­tri­al struc­tu­re (e.g. rela­ti­ve skill levels across regi­ons for jobs wit­hin a given indus­try sec­tor), which are not reflec­ted in this ana­ly­sis for data avai­la­bi­li­ty rea­sons.”

That’s a fair­ly-inte­res­ting sta­tis­tic that’s also fair­ly glos­sed over. They are hard to mea­su­re, but the popu­la­ti­ons of the North and Mid­lands are­as of the UK amount to some­thing like 25.2 mil­li­on peop­le. Lon­don, in con­trast, has a litt­le over 8 mil­li­on peop­le. That means a sli­de of 1 per cent in roles wit­hin the North and Mid­lands will affect more the­re than will bene­fit in the capi­tal from a 2 per cent increa­se.

 

The­re will be a very real poli­ti­cal cost wit­hin eco­no­mi­c­al­ly-poo­rer regi­ons, espe­ci­al­ly if the capi­tal and other lar­ger cities are seen to bene­fit. This means that governments, com­pa­nies, and other orga­ni­sa­ti­ons need to look at what needs to be put in place befo­re this effect begins to bite.

 

PwC also ack­now­ledge this, say­ing that government should:

  1. Invest more in STEAM (sci­ence, tech­no­lo­gy, art and design, engi­nee­ring, and mathe­ma­tics) skills.
  2. Encou­ra­ge peop­le to con­ti­nu­al­ly update and adapt skills.
  3. Streng­t­hen the safe­ty net for tho­se unab­le to adapt to tech­no­lo­gi­cal chan­ge.

 

Fur­t­her recom­men­da­ti­ons from the firm inclu­de:

  1. Sup­port for sec­tors that will gene­ra­te new jobs, such as uni­ver­si­ty rese­arch cen­tres, sci­ence parks, and other enab­lers of busi­ness growth.
  2. The imple­men­ta­ti­on of an AI stra­te­gy that puts for­ward a broad ran­ge of poli­ci­es to sup­port the deve­lop­ment of the AI sec­tor.
  3. The pro­mo­ti­on of effec­tive com­pe­ti­ti­on bet­ween AI com­pa­nies.

 

There’s more that governments and the ser­vice indus­try can do to focus on the AI revo­lu­ti­on that is com­ing down the pipe. Along with inves­ting in the crea­ted roles, they need to look at the indus­tries that will be crea­ted secon­da­ry to AI jobs. That may inclu­de com­pli­an­ce offi­cers and legal roles, com­pu­ter engi­neers, tele­com­mu­ni­ca­ti­ons, and mecha­nics and tech repair jobs.

 

The com­ing revo­lu­ti­on should make com­pa­nies and orga­ni­sa­ti­ons reas­sess how they do busi­ness. Ins­te­ad of focu­sing on quan­ti­ty, they will be able to pivot to a more qua­li­ty-cen­tric approach. That qua­li­ty will come from humans, who will remain inte­gral to the eco­no­my becau­se of the things they can do that robots can­not.

 

 

 
For more infor­ma­ti­on, plea­se con­tact:

Pete Car­vill (@pete_carvill)
Com­mu­ni­ca­ti­ons Mana­ger
+49 (0)30 555 781 999
peter.carvill@retresco.de

 

 

About Ret­res­co

Foun­ded in Ber­lin in 2008, Ret­res­co has beco­me one of the lea­ding com­pa­nies in the field of natu­ral lan­guage pro­ces­sing (NLP) and machi­ne learning. Ret­res­co deve­lops seman­tic app­li­ca­ti­ons in the are­as of con­tent clas­si­fi­ca­ti­on, recom­men­da­ti­on, as well as high­ly inno­va­ti­ve tech­no­lo­gy for natu­ral lan­guage gene­ra­ti­on (NLG). Through near­ly a deca­de of deep indus­try expe­ri­ence, Ret­res­co helps its cli­ents acce­le­ra­te digi­tal trans­for­ma­ti­on, increa­se ope­ra­tio­nal effi­ci­en­ci­es, and enhan­ce custo­mer enga­ge­ment.

 

Sources

© James Pond via unsplash.com

 

Contact eng