The IMF warns AI will affect nearly 40% of jobs worldwide and worsen overall inequality

A pedestrian walks past a TATA pop-up store with a poster reading ‘The Future is AI’ outside the World Economic Forum (WEF) in Davos, Switzerland, Sunday, January 14, 2024. The annual Davos gathering of political leaders, top executives and celebrities runs from 15 to 19. January. Photographer: Hollie Adams/Bloomberg via Getty Images

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The International Monetary Fund has warned that nearly 40% of jobs worldwide could be affected by the rise of artificial intelligence, with high-income economies facing greater risks than emerging markets and low-income countries.

The Washington DC-based institution on Sunday assessed the potential impact of AI on the global labor market and found that in most cases the technology is likely to worsen overall inequality.

IMF chief Kristalina Georgieva called on policymakers to address this “disturbing trend” and to proactively take steps “to prevent technology from further fueling social tensions.”

“We are on the brink of a technological revolution that could jump-start productivity, boost global growth and raise incomes around the world. But it could also replace jobs and deepen inequality,” Georgieva said.

The IMF noted that about 60% of jobs could be affected by AI in high-income countries, and about half of those could benefit from integrating AI to increase productivity.

In comparison, AI exposure is estimated at 40% in emerging markets and 26% in low-income countries.

The findings suggest that emerging markets and low-income countries face less disruption from AI in the short term. The IMF notes that many of these countries lack the infrastructure of skilled workers to take advantage of the immediate benefits of AI, raising the risk that the technology could exacerbate inequality.

The IMF also noted that AI could affect income and wealth inequality within countries and warned of “polarization within income bands”.

She said workers who have access to the benefits of AI could increase their productivity and pay, while those who can’t risk falling further behind.

Goldman Sachs has previously warned that generative artificial intelligence could affect up to 300 million jobs worldwide, although the Wall Street bank admitted the technology could boost labor productivity and growth and boost gross domestic product by as much as 7%.

The IMF report comes as business and political leaders from around the world gather at the World Economic Forum in Davos, Switzerland. The WEF’s annual meeting, which runs until Friday, is under the theme “Rebuilding Trust”.

The WEF says the Davos program embodies the “back to basics” spirit of open and constructive dialogue between policymakers, business leaders and civil society, with the benefits and drawbacks of artificial intelligence expected to be a key topic of discussion. The event has been criticized in recent years for being out of reach, ineffective and irrelevant.

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