KUALA LUMPUR: Artificial intelligence (AI) is increasingly reshaping jobs within the workforce rather than eliminating them, creating new opportunities for innovation, upskilling, and collaboration between humans and machines.

Economist Dr. Geoffrey Williams said that since initial concerns emerged about Fourth Industrial Revolution (4IR) technologies, including AI, potentially leading to mass job losses, there has been significant misunderstanding surrounding their true impact.

"AI replaces routine tasks; not job replacements. The jobs are still required, and AI can help in routine tasks. 

"While AI can replace routine tasks in most professional jobs, for example, preparing accounts or drafting legal documents, or even in the medical profession in diagnostics, testing, and treatment, we still need accountants, lawyers, and doctors, unfortunately. 

"This mostly changes jobs rather than replacing them. For example, AI still needs people to prompt responses and check the quality. 

"This means people do the jobs in different ways, or their time is released from routine tasks for them to focus on higher value-added tasks that require human intervention and skills," he told Business Times.

Nevertheless, Williams said AI is causing people to change jobs, so the net job losses might be lower than estimated.

He added that the future of work is already with us, but the extent of the impact of AI depends on the rate of adoption. 

He noted that there are still millions of companies that use traditional business models, and they will continue to do so for a very long time. 

"There are also many jobs that cannot remove humans, for example, in the care economy, where nurses and care assistants are needed to look after an increasingly older population. Also, teachers in schools cannot be replaced by AI. 

"We call these "technology resistant" jobs, and there will be an increasing demand for these, so we need to train these skills," he said.

Williams also said there will also be new jobs arising from the use of AI, and people will be trained specifically in tasks to create, use, monitor, check, and regulate AI in many areas.

Therefore, he said the net job creation can be positive. 

On the other hand, he noted that the higher use of AI will create more money, and this will be concentrated in high AI businesses. 

"A new approach to how people earn a living is required, and a universal basic income, where people receive an unconditional cash transfer from taxing AI profits, is likely to be part of this," he said.

Meanwhile, Sunway University economics professor Dr Yeah Kim Leng said that AI is emerging as a game-changing technology, but it is also one of the most disruptive technologies in the present 4IR era.

He noted that while AI enhances human knowledge processing capacity and mimics higher-order thinking skills, especially in synthesising and evaluating information, it can be harnessed to either replace a range of human tasks across various industries.  

"Labour displacements by AI applications are focused on both front-end and back-end tasks of business operations.  

"Many service industries ranging from financial, insurance and professional services to medical and education, leisure and hospitality are faced with both labour-replacing threats and labour-enhancing opportunities to reduce costs or improve productivity.

"Consequently, the Malaysian workforce will have to adapt to the changing skills demand dynamics brought about by the AI-related technological innovations," he said.

While job displacement is inevitable, Yeah said there will be new jobs and skills that will emerge although these may not completely offset the job losses.  

He added that for this reason, an effective social protection system is needed to ensure the affected workers are retrained, upskilled or reskilled.  

"Employees also need to be flexible and adopt life-long learning strategies to respond to the AI threats and opportunities much like the continuing adoption of automation, telecommunication and digitalisation technologies in varying degrees across all industries," he said.

Layouts within major global tech, audit firms

Recently, several major companies announced reduction in their workforces due to the increasing implementation of AI and automation technologies.

This shift has been especially evident in sectors like technology, finance and audit, where AI is now playing a crucial role in transforming operations, reducing manual tasks, and enhancing efficiency.

Among major corporations, KPMG said it plans to lay off about 330 employees, representing 4.0 per cent of its U.S. audit staff of about 9,000. 

The cuts target associate and manager roles, with no partners impacted, and address a decrease in voluntary turnover. 

Meanwhile, PwC, another Big Four accounting firm, is trimming 1,800 jobs, or about 2.5 per cent of its workforce, as part of its own adjustment measures. 

Citigroup announced plans to cut around 20,000 jobs as part of a major restructuring initiative to streamline operations and reduce expenses.

Tech giants are also joining the trend. Microsoft recently announced layoffs in its Xbox gaming division, affecting hundreds, while Amazon is letting go of hundreds of employees from its cloud division, Amazon Web Services, to focus on streamlining key strategic areas.

Apple eliminated over 600 jobs in California in April after deciding to halt its car and smartwatch display projects. 

Tesla's chief executive officer, Elon Musk, announced in an April 14 memo the company's plan to cut over 10 per cent of its global workforce, citing redundancies in specific roles and functions.

Other notable cuts this year include Meta (formerly Facebook), which is continuing its massive restructuring by laying off 10,000 employees, and Ford, which has cut around 2,700 positions in the U.S. automotive sector. 

Cisco has also downsized, reducing hundreds of positions in its workforce as it adapts to shifting industry demands.

In 2024, the AI market surged to over US$184 billion, marking a significant leap of nearly US$50 billion from the previous year, according to Statista. 

This rapid growth is only expected to intensify, with predictions suggesting that the market will "race past" a monumental US$826 billion by 2030.

Malaysia, gearing up for its upcoming Asean chairmanship, has already demonstrated its commitment to becoming a leader in AI and tech. 

In just over a month this year, the country attracted three massive billion-dollar investments from global tech giants, each planning to establish data centers and drive AI initiatives locally. 

Microsoft announced an investment of US$2.2 billion, Google followed closely with US$2 billion, and ByteDance, the parent company of TikTok, committed US$2.1 billion.

These strategic moves showcase Malaysia's determination to "walk the talk" when it comes to fostering AI growth, underscoring its ambitions to set the pace for technology and innovation across the Asean region. 

With these investments and its impending role as Asean chair, Malaysia is positioning itself as a key player in the future of AI.

https://www.nst.com.my/business/economy/2024/11/1132609/ai-reshaping-jobs-within-workforce-economists