(Yicai) Dec. 16 -- At this stage, there is a clear tendency to overestimate the impact of artificial intelligence on the job market, according to a chief macroeconomist at the International Labour Organization.
The initial predictions made 10 to 15 years ago suggested that 40 percent to 50 percent of jobs would be affected by AI, but there have not been such drastic signs yet, Ekkehard Ernst told Yicai in an exclusive interview.
There are indeed some specific areas that have been impacted, particularly software engineering, where younger workers are finding it more challenging to enter the labor market due to AI, Ernst explained. However, these are relatively minor cases, as there is not a significant disruption caused by this technology in the labor market.
In the labor market, AI is more about reshaping and transforming jobs rather than massively replacing them, Ernst noted. Many routine tasks that people are working on today, especially in the service sector, are gradually being taken over by machines. This often enables businesses to make employees more productive or allows them to focus on serving new customer segments.
Ernst stressed that the priority for policymakers should be to protect people rather than specific jobs. From a long-term perspective, trying to preserve individual positions or resist technological change is neither realistic nor desirable. What matters is ensuring that workers are supported through adequate social protection systems, so they can adapt and move into new opportunities created by technological change.
When asked why global labor productivity is still relatively sluggish despite the rising AI adoption, Ernst said that AI follows a similar trend as in past technological developments. Typically, the emergence of new technologies takes a long time to truly impact employment, and right now, there is no direct effect on jobs.
Companies will gradually adapt to AI and enhance employee productivity, which does not necessarily mean that jobs will disappear, he pointed out. The entire process often takes longer than expected, and that is one reason why there are no significant changes in labor market or productivity data yet.
About the changes in the global labor market over the past year, Ernst mentioned the slowdown in economic and employment growth. When the ILO released its report last year, many regions were still facing labor shortages, which have now completely disappeared. There is not an increase in unemployment, but a noticeable deceleration in employment growth, he pointed out.
The most critical sector right now is clearly the technology sector, according to Ernst.
Tech companies have very high valuations in the stock market, which is related to market expectations that they will be able to generate profits and new sources of revenue in the future, he explained. Once these prospects materialize, these firms will create additional demand for other industries. But it is evident that the initial impact and job creation will occur in the high-tech sector.
Despite various uncertainties this year, the global economy has shown considerable resilience. The ILO expects this resilience to continue next year, potentially bringing new growth momentum, Ernst said, adding that he believes that adjustments driven by technology are taking place, and geopolitical events are also having an impact.
Once the global economy has absorbed these events and businesses make the necessary adjustments, there will likely be an acceleration in growth by 2027 or even earlier, Ernst predicted.
Editor: Futura Costaglione
