As per the World Development Report, a total of 2.6 million industrial Artificial Intelligent robots will be in operation by the end of 2019. That means 2.6 million + people out of work.
What is Artificial Intelligence?
According to Britannica, Artificial intelligence (AI) is the ability of a digital computer or computer-controlled robot to perform tasks commonly associated with intelligent beings.
It sounds scary and exciting at the same time.
The World Development Report 2019 mentions that the world’s largest assembler of electronics, Foxconn Technology of China, has introduced robots that are already cutting 30 percent of it’s workforce. Similarly, Sberbank (the largest bank of Russia) used ‘Robot Lawyers’, replacing 3,000 human employees and it is estimated that the number of human employees in the bank will be reduced to 1,000 by 2021. In 2011, the bank had 59,000 employees!
It is estimated that 47 per cent of US jobs are at high risk. Below is the probability of the jobs which are expected to be lost to algorithms by 2033.
| Human telemarketer and insurance underwriters | 99% |
| Sports Referees | 98% |
| Cashiers | 97% |
| Chefs | 96% |
| Waiters | 94% |
| Paralegal assistants | 94% |
| Tour guides | 91% |
| Bakers | 89% |
| Bus drivers | 89% |
| Construction laborers | 88% |
| Veterinary assistants | 86% |
| The list goes on… |
There is no doubt that we will loose a lot of jobs to AI. It is just a matter of time.
The Silver Lining
Artificial Intelligence will increase production of goods and efficiency and effectiveness of services which will enable jobless-humans to feed and breed. Or maybe not!
As far as long term Investors are concerned, this sounds like the new name of the game.
Any companies who are in control of these super computers will have pricing power over the much needed robots.
Companies Investing in AI
According to PwC-2017, forecast report AI could add nearly $15.7 trillion to the global GDP by 2030.
The top Tech Companies have made heavy investment in AI.
- Google – $ 3.9 Billion
- Amazon – $871 Million
- Facebook – $60 million
- Microsoft – $690 million
- Apple – $786 Million
Not just Tech companies, the entire spectrum of industry are in the AI game.
(Source: McKinsey & Company)
If AI got you exciting, here are the eight single biggest disclosed investments in AI startups to date.
- 1. Nest Labs – $3.2 billion
- 2. Kiva Systems – $775 million
- 3. Otto – $680 million
- 4. Deep Mind – $500 million
- 5. TellApart – $479 million
- 6. Movidius – $400 million
- 7. Nervana – $350 million
- 8. SwiftKey – $250 million
Final Thought
It is impossible to predict the future so we try to stay away from this guessing game. AI will certainly add a lot of values to companies and Humans. Currently, there is a lot of chaos.
“Our survey of more than 3,000 businesses around the world found that many business leaders are uncertain about what exactly AI can do for them, where to obtain AI-powered applications, how to integrate them into their companies, and how to assess the return on an investment in the technology.” – McKinsey Report (Click here for the full Report)
I think Historian Professor Yuval Noah Harari summarized this perfectly for us.
Affiliate link to Amazon“As algorithms push humans out of the job market, wealth and power might become concentrated in the hands of the tiny elite that owns the all-powerful algorithms.” – Yuval Noah Harari.
Disclaimer: Long Position in Google, Amazon, Apple, Facebook, Microsoft, Alibaba, Tencent.
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