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AI impact on global jobs: Inequality risks high lighted in new IMF report

Thursday, 18 January 2024 16:35
AI impact on global jobs: Inequality risks high lighted in new IMF report

(Ecofin Agency) - A recent report by the International Monetary Fund (IMF) reveals that nearly 40% of jobs worldwide will be affected by the effects of Artificial Intelligence (AI). The study emphasizes that while Africa may experience a comparatively lower impact than other regions, it could exacerbate inequalities between countries.

Published on January 14, the report indicates that the impact of AI will be unevenly distributed based on a country's development level. While developed countries may witness 60% of their jobs being influenced by AI, this figure is expected to be 40% in emerging economies and only 26% in low-income countries. Essentially, advanced economies face greater vulnerability in terms of job displacement due to AI, but their workforce is also better positioned to capitalize on opportunities presented by this technological revolution, thus widening the gap with poorer nations.

"These findings suggest that advanced economies may be more susceptible to labor market shifts from AI adoption, materializing over a shorter time horizon than in emerging market economies and low-income countries,” the report reads.

Preparing Africa to harness AI potential

The report comes at a time when Artificial Intelligence is becoming a major public policy issue globally, affecting both affluent and impoverished nations. In Africa, AI events and conferences have multiplied in recent years, driven by the upheavals caused by the COVID-19 crisis, which has reshaped the habits of digitally-influenced populations.

“It is still unclear how it will affect existing jobs and what safety concerns there will be, but it is also already possible seeing that Africa has the most to gain,” said Rwandan President Paul Kagame in April 2023 during the Transform Africa Summit, which prominently featured discussions on AI.

While there is a willingness to anticipate and leverage the potential of this digital revolution in Africa, both among public policymakers and private stakeholders, the continent still faces significant challenges hindering its preparedness for the full deployment of AI's potential. Despite a substantial increase in internet subscribers on the continent, Africa remains the least connected region globally.

According to the report, preparedness for AI varies according to a country's development levels. Advanced economies and more developed emerging markets should invest in innovation, AI integration, and suitable regulatory frameworks. However, less-prepared economies, notably in Africa, must prioritize infrastructural development and the training of a digitally competent workforce. This requires the implementation of social safety nets and the retraining of workers vulnerable to AI to ensure inclusivity.

According to the IMF, in most scenarios, AI will likely worsen overall inequality, a concerning trend that policymakers must address proactively to prevent technology from exacerbating social tensions. The fund suggests that countries must establish comprehensive social protection mechanisms and plan retraining programs for exposed workers. “In doing so, we can make the AI transition more inclusive, protecting livelihoods and curbing inequality,” Kristalina Georgieva, MD of IMF, said.





 
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ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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