How Artificial Intelligence impacts the economy

 Anchal Sethi
  Oct 30, 2018

The moment you hear about Artificial Intelligence (AI), you tend to think about sophisticated robots, smart personal assistants, and other such cool technological innovations that are transforming the world as we speak. After decades of lurking in the shadows, giving us hopes of a new era, Artificial Intelligence has now leaped to the foreground to create a wave of drastic change through innovation. We say ‘leaped’ because the change that we are witnessing around us today - smart voice assistants, AI players that can defeat the world champions, chatbots, the IoT, and so much more - has come somewhat suddenly and at a pace that was difficult to fathom.

But now that the myriad forms of AI are continuing to penetrate the industry as well as the lives of the common men, there arises a pivotal question - What promises does AI hold for the global economy?

Mark Purdy, MD of Economic Research at the Accenture Institute for High Performance, maintains:

“Artificial Intelligence heralds dramatic potential for growth for both the economy and for humans."

According to a PwC report, AI is apparently the biggest commercial opportunity today. By 2030, AI will become one of the major contributors to the global economy reaching up to nearly $15.7 trillion, with China leading the way ($7 trillion)!

The report further suggests that four sectors of the industry will reap the optimum benefits of AI tech - Professional Services, Manufacturing, Financial Services, and Wholesale & Retail.

Now, you might naturally ask, how will it do so? The foremost economic advantage that AI is set to bring is to enhance the productivity of the human capital. By incorporating AI within the core infrastructure of an organization, the productivity quotient of the existing labor and capital can be improved by manifold. As AI-powered automation can take over By the monotonous and basic tasks related to production and business operations, it will provide the workforce with an increased scope to focus on doing what humans do best - think, visualize, and create. The best part - AI-powered automation can deliver complex physical tasks with greater efficiency because contrary to conventional automation solutions, AI-powered automation technology is self-learning. It is designed to learn through experience and adapt according to situations and behaviors, thus, creating a more ‘agile’ work environment.

This is precisely what the world needs today. With the birth rates going lower and the proportion of the aging populace scaling higher, the world will not have enough productive human capital to spur the economic growth. In the face of the declining labor forces around the world, technology may be our only solution to bridge the gap between the reduction in the human capital and the ever-increasing demands. For instance, Panasonic, the Japanese electronics giant, has already started to experiment with AI technology by deploying AI-powered robotic exoskeletons to assist the older workforce to carry out a variety of tasks. This is an excellent example to maintain the relevancy of the aging workers and ensure that they remain active contributors to the economic productivity of a nation.

Another remarkable example of AI is Machine Translation. The best case in point is perhaps eBay’s 2014 experiment with an AI-based tool that could learn to translate a language into another by ingesting a bulk of data (both from eBay and the Internet). This tool that functioned as a Spanish-English translator (basically for search queries and product names) supposedly increased the eBay exports to Latin America from the US by over 17%.

The most commendable aspect of Machine Translation is perhaps the fact that it can learn and teach itself new languages when fed with relevant historical data. This ML language translation tool is the answer to bridge the language barriers that have hampered trade and business among countries since time immemorial. But thanks to AI, countries are now able to overcome this obstacle and engage in trade with one another. The more the trade barrier breaks, the better it is for the global economy. Now, ML technology is being applied to other areas too including face recognition, speech recognition, and personalized recommendation lists, to name a few.

While the biggest fear with AI is that it will create a largescale displacement of many jobs in the near future, you need to stop for a moment and think about what AI is bringing to the table - the creation of diverse and exciting job opportunities. In fact, as the AI technology continues to progress, new job positions are cropping up across various parallels of the industry such as AI Engineers, AI Architects, Data Scientists, ML Engineer, Business Intelligence Developer, among others.

This is not to dismiss the fear of job displacement altogether, however, it’s only to bring to your attention the fact that although some jobs might be replaced, many more jobs will take their place. Let’s look at the mobile application market for that matter. It was only a few years ago that the world was given a new innovation - the smartphone - and with it came blossoming the mobile app market. Had the smartphone not been there, there would have been no app market (which, by the way, is an $88 billion industry!) and there would definitely have been no prospects for mobile app developers. In the same way, Artificial Intelligence is also giving birth to a more expansive and niche job market that is always on the lookout for trained and highly-skilled data professionals.

Now, the question that remains to be settled is - How do you prepare yourself for a future that is dominated by technology such as AI?

The answer is pretty simple - Upskill! If you think that your current profession bears the possibility of being engulfed by AI, you should take a shot at upskilling your knowledge and expertise to continue to maintain your relevancy in a highly technology-dominated industry. What you must always remember is that although AI is self-learning technology that fosters automation, the ultimate key to training and enhancing this technology still remains with humans. It is true that AI can learn, but it cannot think for itself, and here lies your competitive edge over technology. This is precisely the card you’ve got to play! Thankfully, upskilling has become way easier now that numerous online platforms are offering Artificial Intelligence courses. These courses focus on teaching students about the a-z of AI and its subset technologies such as Machine Learning so that they are industry-ready. The goal is to prepare the new generation for a future where machine intelligence and human intelligence can go hand-in-hand to drive innovation and spur economic growth and development.

How Artificial Intelligence impacts the economy

Anchal Sethi

Anchal Sethi is a seasoned writer who has over the years contributed quality content on various high-profile websites. She has particularly excelled in niches like Fashion, Business, Entrepreneurship, Education etc. Her professionalism, four year's experience, and expertise make her one of the most sought-after content writers in the field.

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