PMC Weekly Review - November 10, 2017

A Macro View: Rise of the machines and the opportunity they bring

Facial recognition in phones, driverless cars, and drones once may have been perceived as a wave of the future, but since the 1980s, computers and digitalization have revolutionized the way we live. Our day-to-day lives and jobs depend on technology in many ways. And while it certainly has made our overall lives easier, many fear we are entering the age of the robots—that artificial intelligence (AI) will replace the need for humans in a number of professions.

Automation and AI often get confused and used interchangeably, but they differ greatly. Automation is defined as a technique, method, or system of operating or controlling a process through electronic means, reducing human intervention to a minimum. AI, on the other hand, is a machine’s capability of imitating intelligent human behavior. As opposed to being programed to complete monotonous or repetitive tasks, AI imitates cognitive functions to learn and adapt after analyzing data.

Both have implications for the job landscape, as technology innovators such as Elon Musk and Jack Ma have cautioned. With sweeping technological developments towards automation and AI, some jobs and industries will likely disappear, while others could morph into new opportunities. But jobs have long been under threat from automation. Employers continuously invest in new technology solutions to cut costs, and thousands of jobs have already been replaced by computers or robots. Manufacturing has been one of the hardest-hit sectors, losing approximately 5 million jobs since the year 2000, 88% of which are attributed to automation1. Additionally, the retail and restaurant industries are shifting away from cashiers to digital kiosks and mobile ordering. McDonald’s is one example: it recently announced that almost 6,000 cashiers will be replaced by 2018. These industries often represent entry level and blue-collar jobs, which require little education. However, AI has the potential to eliminate even some of the higher-paying professions that require a college degree, broadening the scope of the number of people who may be affected. One study by PwC suggests that with the rise in automation and AI, 38% of US jobs could be at risk within 15 years2.

But the news is not all dim and grim. AI has the potential to create new job opportunities, boost productivity, and solve major world problems. Coding and programing have already become two of the top coveted skills sought by employers. A recent study from Burning Glass Technologies found that in 2015, 7 million job postings requested coding skills, and estimated that these types of jobs are growing 12% faster than the market average3. Additionally, some even think that AI technology could increase productivity by 40% in less than two decades, leading to a large economic boost4.

It’s true—change is scary. But technology has improved how we communicate, educate, and interact with one another. And it has had a daily impact on our lives—we already are using AI without realizing it. Netflix, for example, uses proprietary technology to gage our interests and intelligently recommend new shows or movies. Its AI software has been a primary driver of its success in creating original content. Netflix collects data on the actors, directors, plots, and show concepts that the majority of consumers prefer, giving it an edge in predicting what shows or movies will be widely accepted. Although machines and robots may pose a threat to some industries and jobs, we should not fear progress. AI undoubtedly has transformative power—and creative and skilled thinkers should stand to benefit from it.

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