As young individuals enter the job market, they are encountering what some are calling an “employment apocalypse.” This is due to business leaders opting to invest in artificial intelligence (AI) over new hires, as revealed in a survey of global executives.
A report by the British Standards Institute (BSI) indicated that rather than nurturing junior employees, employers are focusing on AI automation to bridge skill gaps and enable layoffs.
In a study involving over 850 business leaders from seven countries—namely the UK, US, France, Germany, Australia, China, and Japan—41% of respondents reported that AI has facilitated a reduction in their workforce.
Nearly a third (31%) stated their organizations are considering AI solutions before hiring new talent, with two-fifths planning to do so in the next five years.
Highlighting the difficulties faced by Gen Z workers (born from 1997 to 2012) in a cooling labor market, a quarter of executives believe that AI could perform all or most tasks currently handled by entry-level staff.
Susan Taylor-Martin, CEO of BSI, commented: “AI offers significant opportunities for companies worldwide. However, as firms strive for enhanced productivity and efficiency, we must remember that humans ultimately drive progress.
“Our findings show that balancing the benefits of AI with supporting the workforce is a key challenge of this era. Alongside our AI investments, long-term thinking and workforce development are crucial for sustainable and productive employment.”
Additionally, 39% of leaders reported that entry-level roles have already been diminished or eliminated due to the efficiencies gained from AI in tasks like research and administration.
More than half of the respondents expressed relief that they commenced their careers before AI became prevalent, yet 53% felt that the advantages of AI in their organizations outweigh the disruptions to the workforce.
UK businesses are rapidly embracing AI, with 76% of leaders anticipating that new tools will yield tangible benefits within the next year.
Executives noted that the primary motivations behind AI investments are to enhance productivity and efficiency, cut costs, and address skills gaps.
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An analysis from BSI of companies’ annual reports revealed that the term ‘automation’ appeared almost seven times more frequently than ‘upskilling’ or ‘retraining.’
Additionally, a recent poll from the Trades Union Congress found that half of British adults are apprehensive about AI’s impact on their jobs, fearing that AI may displace them.
Recent months have seen the UK’s job market cool, with wage growth decelerating and the unemployment rate rising to 4.7%, the highest in four years. Nevertheless, most economists attribute this not to a surge in AI investments.
Conversely, there are worries that the inflated valuations of AI companies could spark a stock market bubble, potentially leading to a market crash.
Source: www.theguardian.com
