The Governor of the Bank Of England (BoE), Mark Carney raised the alarm bells over automation in his speech at Liverpool's John Moore University earlier this week, describing the ‘machine age’ as one that will ‘mercilessly’ destroy jobs. He warned of 15 million jobs being replaced by automation – around half of the UK workforce. Mr Carney’s estimate is reminiscent of Professor Moshe Vardi's predictions that global unemployment rates will rise to over 50% within 30 years.
UK outsourcing specialist Capita's recent announcement that it intends to replace 2,000 jobs with automated technology has only added fuel to the AI flame.
The world is in the grip of a relentless technological evolution but is the apocalyptic vision of the future workforce as dire as suggested in this speech?
AI is described as the ‘fourth industrial revolution’ leading to the hollowing out of middle income, medium skilled jobs affecting every sector. It is one of the four major influences which will affect the future of work between now and 2035.
The inevitability of AI?
AI investment is expected to grow by over 300% in 2017 compared to 2016 according to research consultancy Forrester in its report : Predictions 2017 : Artificial Intelligence Will Drive The Insights Revolution. Writing in Harvard Business Review Andrew Ng observes that ‘if a typical person can do a mental task with less than one second of thought, we can probably automate it using AI either now or in the near future.’
But a further article from McKinsey notes that ‘just because an activity can be automated doesn’t mean that it will be’. Nevertheless, it suggests that as AI evolves, jobs involving higher skills will be automated at an ever growing rate. For example, McKinsey predicts 43% of existing activities in the financial sector could be automated. In the UK, the public sector is likely to be one of those most at threat with at least 850,000 jobs under threat of automation.
A positive view
Rather than AI leading to a jobless future, Stanford University’s, One Hundred Year Study on Artificial Intelligence suggests that AI will be regarded as a ‘radically different mechanism for wealth creation’ replacing ‘tasks rather than jobs’ and leading to the creation of new types of jobs.
Deloitte also predicts a more optimistic view, suggesting that high risk jobs will be replaced by more creative low risk jobs. Each of these new roles is expected to attract a salary £10,000 higher than the one it replaces, adding an estimated £140 billion to the UK economy in the process.
A new report Workplace More Human concurs with that view, with the majority (85%) of employers believing that automation will create more jobs than it replaces within 10 years. Improved productivity and the development of new skills were regarded as the main benefits of this workplace evolution. It also notes that over half of businesses are automating processes that were traditionally carried out by people.
HR’s reluctance to engage
If HR is to avoid the ‘merciless’ effects of AI predicted by the BoE Governor, it must address two obstacles:-
Training : The Workplace More Human report found that over half (54%) of business leaders believe that training and development for automation should be a major focus of HR over the next five years. Retraining and reskilling employees may appear to be a relatively straightforward solution but the UK is already facing a digital skills shortage. Furthermore, there is a clear reluctance among UK employers to invest in training necessary to tackle the talent shortage.
Technology : Research from the Institute of Directors found that 45% of IT managers believe company leaders are holding back from adopting technology due to its disruptive effects and the impact it will have on their individual position. Nearly two thirds (63%) also felt that UK businesses are too hesitant to adopt new technology and over half (56%) feel that inadequate investment is made in their business.
UK employers must overcome that reluctance in both key areas if they are to keep pace with change, not just in AI but when dealing with the impact of the gig economy, the potential decline of globalisation and Brexit among others.
For HR managers wary of the impact of automation on their own function, McKinsey predicts that activities with low technical potential for automation include those that involve managing and developing people.
Transitioning To AI
The need for accurate data customised to meet unique business needs and easily accessible in one central location will become increasingly important for effective workforce management. HR must be able to understand and analyse the data available in order to predict future hiring patterns, while managing the inevitable workforce changes that arise from automation.
For HR, automation its most basic form offers a number of benefits:-
- It streamlines hiring processes with faster screening.
- Reduction of bias in recruitment processes.
- It takes care of tasks that would normally be carried out manually. At present, HR spends two days per week on tasks that could be automated through technology.
- Automation also HR with the opportunity to be at the forefront of these unavoidable changes.
Accountability must also form part of any formal strategy for the adoption of HR technology and AI.
Mark Carney’s comments are not without foundation but the nature of work is changing. The tech skills that are in demand today didn’t exist five to ten years ago and according to the World Economic Forum, 65% of today’s primary children will be employed in jobs that don’t yet exist.
AI is a catalyst for change and HR must adapt to and embrace it by overcoming its caution and reluctance to engage to meet the challenges of the future, something which it has been slow to do so far.
Advorto’s recruitment software provides workflow and structure across the entire hiring process, offering a dynamic database of candidates and analytics. Used by some of the world’s leading organisations, it provides a straightforward first step into big data and automation - and artificial intelligence.
Contact us today to start your 30 day free trial.
You might also like to read:-
Wearables At Work : Big Data Or Big Brother?
HR Holds The Key To Business Success With People Analytics