The Futuristic Economy: Artificial Intelligence (AI), Human Resource Extinction and Wealth Creation

artificial intelligence

The future, they say; belongs to people who believe in the beauty of their dreams. The imagination of this beauty may only be an inspiration mirage if the future speeds faster than our thought. If you have ever used a navigation system app, a music streaming service or social platforms such as Facebook, WhatsApp and Wechat, you have been artificially intelligence. Artificial intelligence (AI) in this article refers to “intelligence demonstrated by machines, in contrast to the natural intelligence displayed by humans and other animals”.

The evolution of Information Technology and Computer Engineering has travelled faster in the past few decades than we may have thought. Since 2010, AI has grown at a compounded annual growth rate of almost 60%. Our daily life activities have been occupied with the exploration of AI yet we have not recognized the opportunities surrounding such evolutions. In as much as humanly strategic, creative and rational thinking will outperform machines, it is as well an established fact that Machines can perform certain task easier, faster and efficient than human. The internet today has created the largest database in the world.

The United State ranks as the top country with the most AI companies as it remains the home  for over 1000 AI companies and over US$10 billion in AI venture capital. According to Bank of America, by 2020, 85% of all tech support enquiries will be covered by AI. AI will as well produce 20% of content by 2020 and predicted to reach a $16B market size by 2022. You may have already heard of AI projects like Amazon Go, Doordash, Blue River Technology, Zoox, Dataminr, BloomReach, Cylance, etc. I call this AI initiative the “Evolution of Wealth”. Africa must wake up!

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In the period between 2011 and 2015, The Times Higher Education reported that, China published over 41,000 papers on AI recording twice as much as the US number. China has already invested over $7billion in AI as it has an intention to become “a principal world center of artificial intelligence innovation” by 2030.  Unlike US, China has the most comprehensive national plan to become a leader in AI technology as Chinese startups receive 48% of all funding for AI investments. The story in Japan is no different, as more than 55% of work activities in Japan are being automated. The manufacturing sector in Japan, according to an HBR article has an estimated 71% automation potential due to its ageing population and decreasing workforce. In 2017, Canada invested $125 million as its commitment to AI research whiles France is determined to invest USD 1.8billion in AI research until 2022. Singapore, Germany, Australia, etc. is aggressively investing in AI. Russia spends an estimated amount $12.5 million annually on AI. President Vladimir Putin recently believes that, the leader in AI in the next generation will “rule the world.”

In as much as many Africa countries do not stand tall in AI investments and Initiatives, it has attracted huge investments from foreign counterparts. The African continent is expected to own 25% of the world’s population by 2050. This makes Africa a potential market for investment in AI technologies as population predicts demand and supply. In June 2018, Google, one of the biggest multinational technology company that provides Internet-related services like online advertising technologies, search engine, cloud computing, software, and hardware announced the establishment of AI research center in Ghana. The AI research center will focus on using AI in healthcare, agriculture and education. This may mean that traditional healthcare, education and agricultural related jobs may become extinct.  Facebook already owns a technology hub in Lagos and has as well launched satellites to deliver internet access to sub-Sahara Africa. Russia is currently eyeing investments in East Africa and the Chinese are already spending billions on infrastructure and other projects in Africa.

This is the bigger picture of AIs impact on human resource extinction. McKinsey Global Institute research suggests that by 2030, intelligent agents and robots could eliminate as much as 30 percent of the world’s human labor. According to the report, automation will displace between 400 and 800 million jobs by 2030, requiring as many as 375 million people to switch job categories entirely. Developed economies like the US and Germany are expected to be hit the most. In America, the report predicts that employment in industries like health care will increase, as society copes with an aging population; while jobs that involve physical labor (machinist, cooks) or data processing (payroll clerks, data entry) are most at risk of automation. In the US alone, between 39 and 73 million jobs stand to be automated, making up around a third of the total workforce.  According to Daron Acemoglu and Pascual Restrepo, between 1990 and 2007, each new robot in the local workforce lead to the loss of 3 – 5.6 jobs whiles for each new robot added per 1,000 workers leads to 0.25 – 0.5 percent reduction in wages.  Amazon’s Alexa recently began syncing with Outlook and Google to help families keep up with their hectic schedules. What this means is, job availability of secretaries and personal assistantship role may reduce in the near future.

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Practically, AI is taking over in every industry; banking, accounting, medical diagnosis, automobile, education and all aspects of engineering. The question is, how relevant will your educational certificate be in the next 10, 20 and 30years? For the bankers, AI in banking can be traced as far back1987. Banks are using artificial intelligence systems today to organize operations, maintain book-keeping, invest in stocks, and manage properties. In August 2001, robots beat humans in a simulated financial trading competition.  AI has also reduced fraud and financial crimes by monitoring behavioral patterns of users for any abnormal changes or anomalies.

For the medical students, AI is performing diagnosis and handling medications. For the accountants, AIs are performing payroll management, preparing and analyzing financial statements of all forms. For the drivers, we can all relate to the pace at which self-driven automated cars are being manufactured. As of 2016, there are over 30 companies utilizing AI into the creation of driverless cars. For the sales executives, marketers, bankers, stock brokers, nutritionist, agriculturalist etc. AI are taking over the jobs. It is estimated that about 85% of customer interactions will be managed by AI by 2020. Globally, annual military spending on robotics rose from 5.1 billion USD in 2010 to 7.5 billion USD in 2015. Military drones capable of autonomous action are widely accepted useful asset. Will our human resource skills fit in the futuristic economy?

Technology they say destroys jobs, but not work. It is no doubt that the invention of mobile phones and personal computers created over 18.5 million new jobs in the USA alone, however, the same may not be the case for new and future technological breakthrough. Industrial robots alone has destroyed more jobs than have created. Juxtaposing the number of graduates produced yearly around the world against the number of job creations, it is only realistic to think of other alternatives to survive the AI evolution. Perhaps, most developing countries, particularly, Africa have yet not realized this new AI evolution as compared to the developed world.  A Pew Research Center study asked 1,896 AI experts about the impact of emerging technologies and found that:

“Robots and digital agents will have displaced significant numbers of both blue- and white-collar workers-with many expressing concerns that this new evolution will lead to vast increases in income inequality, masses of people who are effectively unemployable, and breakdowns in the social order”.

It is no doubt that Artificial Intelligence (AI) will transform our world and sooner or later Africa will as well be hit by this reality. However, the bigger question is; are we thinking of other alternatives to outperform AIs to create wealth in the next generation.

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In the next few years, Africa must bridle and transform its human capital to meet the demands of the AI futuristic economy. AI will replicate certain activities and work faster than humans, at greater speed and scale. However, it may as well improve the productivity of many jobs and create millions more new jobs. The way forward is the integration of Humans and AI to co-exist and work for the good of the society.

Young graduates as well must develop the needed skills to meet future AI demands. As the division of tasks between man and machine changes, re-evaluation of the type of knowledge and skills imparted to future generations must change as well. It is essential for policy makers to revise Africa’s educational framework and directions. Africa needs strong educational and training institutions that will build, equip and change the directional thinking of young graduates to successfully fit in the futuristic economy. It will interest you to know that some universities in the developed countries are implementing this proactive thinking approach. Stanford University offers a program known as CS+X, which integrates its computer science degree with humanities degrees, resulting in a Bachelor of Arts and Science qualification.

According to Accenture’s Technology Vision 2017, AI has the potential to double annual economic growth rates by 2035. The AI evolution is expected to contribute to a global economic returns of over $16 trillion. I have the strongest of belief that, the futuristic economy of AI will deliver a greater number of billionaires than previously, in any case, only those prepared for the future can embrace the fortune. African economies can as well reap from the futuristic economy as they become the center of attraction of AI investments and potential market in the next 10-20years.

To avoid missing out on this opportunity, policy makers and business leaders must prepare for, and work toward, a future with AI. AI is simply another productivity enhancer and must be seen as a tool that can transform our thinking about how growth is created.”

Our generation must therefore be more conscious in making future decisions by considering the future of AI in our professional lives.

The futuristic economy
Nana Kwame Nkrumah

Article by

Nana Kwame Nkrumah

Phd Candidate – Jiangsu University, PR China

Mobile: +8618651400940      

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