The Incoming Three Waves of Automation: Is AI Going to Change Everything?

February 15, 2018 - 7 minutes read

By 2030, multinational consulting firm PwC estimates that artificial intelligence (AI) could boost the global economy by as much as $15 trillion. But to get to that point, society will have to endure three different waves of automation. Each one will bring its own unique set of benefits and challenges as AI integrates with the world over the next few years.

Preparation Is Prudent

PwC’s recent study of automation spanned 29 countries and over 200,000 jobs, with more than 5,500 of these being in the UK. By analyzing the types of tasks and skills required for each job, the firm concluded that AI development will hit us in three overlapping eras: algorithms, augmentation, and autonomy.

The research led to some interesting findings. Initially, women would feel the impact of automation more, but men would be taking the brunt of change by the last wave in the mid-2030s. The main logic behind this has to do with the fact that some tasks are much more prone to automation than others, and more of these responsibilities reside with jobs usually occupied by men. Regardless of gender profiles, the biggest effect is anticipated to occur between the late 2020s to mid-2030s.

Euan Cameron, UK AI leader at PwC, explains how prudence can pay off in this situation: “Our research shows that the impact from automation and AI will be felt in waves, with more routine and data tasks hit first. But just because businesses and people aren’t feeling the impacts right now, there is no excuse not to start planning for the future.”

Understanding how AI will affect your particular industry or trade is integral to proper preparation. “AI technology is getting more sophisticated every day and businesses need to understand how, where and when their people are likely to be affected in the future,” Cameron explains, “Those that understand the risks and opportunities can start upskilling their people and adapting their businesses, rather than simply reacting when it’s too late.” London developers, now’s not such a bad time to get into AI!

The Age of Algorithms

We’re already in the middle of the first wave, and it’s expected to last into the early 2020s. Dubbed the ‘Algorithm Wave,’ this current period is marked by the subtle but steady introduction of automation to take over easy tasks that are mostly digital in nature. PwC posits that only 2 to 3 percent of UK jobs will be affected during this era because automation is very much still in its nascent stage.

Because of automation’s strong emphasis on data analysis during this time, it’s expected that the financial, information, and communication sectors will feel the most impact. This could be as high as 6 to 8 percent. As mentioned before, women are more likely to experience this disruption firsthand due to their greater presence in administrative tasks for the aforementioned industries.

An Augmented Perspective

The next era, the ‘Augmentation Wave,’ is expected to last until the late 2020s. Transitioning from a focus on digital information exchange, we’ll start to see automation manifesting in more concrete forms. Repeatable activities that require physical entities such as semi-autonomous vehicle transportation, drone deliveries, and warehouse robot logistics will all experience unprecedented levels of automation.

While the finance industry is expected to be affected the most, we’ll start to see the automation effect begin to bleed across all industries. Similarly, women will still be more likely to see automation firsthand during this time, but men will begin to see it more in their day-to-day activities as well. PwC’s projections suggest that up to 20 percent of jobs could be affected by this time.

Gender and industry aside, education level for jobs will start to play an important role in determining automation potential. Both low and medium education levels will be more at risk of automation than positions requiring higher education during this time.

The Final Frontier for Automation

The final era, the ‘Autonomy Wave,’ will be marked by AI’s ability to analyze data, make a decision, and take action without the need for human intervention. Manual activities will receive the automation treatment, which means that driverless cars and autonomous robots will be more common than ever before. Primary industries of disruption include manufacturing, transportation, and retail.

By the mid-2030s, jobs impacted by automation will rise to 30 percent. 44 percent of low-education roles will be at risk of being automated during this time. Men will also begin to feel the effects of automation more tangibly than women due to their higher presence in factories, warehouses, and transportation.

Cautious Optimism

While the above statistics easily paint a ‘doom and gloom’ picture of a future taken over by robots, PwC concludes that the opposite will actually occur. “We don’t believe that automation will lead to mass technological unemployment by the 2030s, any more than it has done in the decades since the digital revolution began,” says John Hawksworth, chief economist at PwC.

He continues, “In the long run, AI, robotics, and related technologies should not only make a significant contribution to UK GDP of up to 10 percent, but should also generate enough new jobs to broadly offset the potential job losses associated with automation.” In fact, PwC estimates that this AI-fueled job creation will actually offset any job losses over time.

Still, there’s no doubt that we’re in the middle of a big transition, and collaboration will be key to getting through it. “…We should not be complacent about the coming waves of automation: there will be challenges to many workers to adapt to these changes through enhancing their skills and retraining for new careers in some cases,” says Hawksworth. “Governments, businesses, trade unions, and educational providers will all have a role to play in helping people through this transition.”

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