Productivity Increases in Sectors Exposed To AI, PwC Finds

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Sectors more exposed to AI are experiencing almost fivefold greater labour productivity growth, new report states

A new report has starkly illustrated the benefits that artificial intelligence (AI) can play in the workplace, despite concerns over widespread job losses.

Accountancy firm PwC announced on Tuesday a new report, the 2024 Global AI Jobs Barometer, which claimed that sectors more exposed to AI (i.e. AI can be readily used for some tasks) are experiencing almost fivefold (4.8x) greater labour productivity growth.

This will be welcome news for employers, but may be not assuage concerns from employees, concerned at their job security.

In March the left-of-centre thinktank, the Institute for Public Policy Research (IPPR), had warned that almost 8 million UK jobs could be lost to artificial intelligence in a “jobs apocalypse”.

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AI jobs, skills

PwC in its 2024 Global AI Jobs Barometer report analysed over half a billion job ads from 15 countries, suggested that AI could allow many nations to break out of persistent low productivity growth, generating economic development, higher wages, and enhanced living standards.

The report found that for every job posting requiring AI specialist skills (i.e., machine learning) in 2012, there are now seven job postings.

PwC research also found that growth in jobs demanding AI skills has outpaced all jobs since 2016, with postings for jobs requiring AI skills growing 3.5x faster than for all jobs.

The findings also highlighted economic opportunity for labour forces: jobs that require AI skills carry up to a 25 percent average wage premium in some markets.

The report also found that skills sought by employers are changing much faster in occupations more exposed to AI, with old skills disappearing – and new skills appearing – in job ads at a 25 percent higher rate than in occupations less exposed to AI.

The report said that in order to stay relevant in these occupations, workers will need to demonstrate or acquire new skills.

Labour market impact

“AI is transforming the labour market globally and presents good news for a global economy hindered by deep economic challenges and concerns around long-term business viability,” noted Carol Stubbings, global markets and tax leader at PwC UK.

“For many economies experiencing labour shortages and low productivity growth, the findings highlight optimism around AI with the technology representing an opportunity for economic development, job-creation, and the creation of new industries entirely,” said Stubbings.

“However, the findings show that workers will need to build new skills and organisations will need to invest in their AI strategies and people if they are to turbocharge their development and ensure they are fit for the AI age.”

Job worries

The PwC report also found that AI penetration is accelerating, particularly in knowledge work sectors.

Despite the productivity increase, there remains deep concern at the prospect of widespread job losses from AI.

Last week Reuters noted that the head of the International Monetary Fund (IMF) Kristalina Georgieva had said AI was hitting the global labour market “like a tsunami” and was likely to have an impact on 60% of jobs in advanced economies in the next two years.

It comes after the IMF in January 2024, had warned that nearly 40 percent of jobs worldwide could be affected by AI, which could result in replacing jobs and worsening inequalities.