The ascent of artificial intelligence (AI) is propelling the world toward a technological revolution, promising increased job productivity, accelerated global growth, and higher incomes, as outlined in a recent International Monetary Fund (IMF) report. Despite the potential benefits, concerns about job displacement and growing inequality call for careful policy considerations to navigate AI's intricate impact on the global economy.
The IMF's report on Gen-AI explores the potential consequences of AI on the global job market, acknowledging that, while predictions of job replacement exist, AI is likely to complement human work in many instances. The analysis reveals that a substantial 40% of global employment is exposed to AI's influence.
Advanced economies, facing both risks and opportunities, may see nearly 60% of jobs impacted by AI, with approximately half benefiting from increased productivity. The other half faces potential challenges, including reduced labor demand, lower wages, and potential job losses as AI takes over certain tasks.
Emerging markets and low-income countries appear to experience fewer immediate disruptions, with AI exposure at 40% and 26%, respectively. However, concerns arise about their ability to harness AI benefits due to lacking infrastructure and skilled workforces, potentially worsening global inequality over time.
The report underscores the pressing concern of AI's impact on income and wealth inequality within countries. A potential polarization within income brackets could occur, with workers adept at leveraging AI experiencing increased productivity and wages, leaving those unable to adapt lagging behind.
To address these challenges, the report recommends proactive policymaking, including the establishment of comprehensive social safety nets and retraining programs for vulnerable workers. The IMF proposes an AI Preparedness Index, measuring readiness across various domains, indicating that wealthier economies are generally better equipped for AI adoption. This emphasizes the need for global cooperation to ensure an inclusive and well-prepared transition into an AI-driven world, with Singapore, the U.S., and Denmark leading in AI readiness.