The advent of advanced artificial intelligence (AI) marks a new era of human progress. As AI capabilities grow more sophisticated, these technologies will fundamentally transform our economy and workplaces. An in-depth analysis by leading Wall Street research firm Evercore ISI reveals the profound impact AI will have across industries and job functions. Their findings provide a comprehensive framework for business leaders to understand where AI can augment human capabilities and drive tremendous value.
Understanding AI’s Potential to Augment Humans
Many fear AI will broadly replace human workers, but the reality is more nuanced. AI excels at automating routine cognitive tasks but still falls short of human creativity, empathy, and social skills. Instead of replacing workers outright, AI will augment human capabilities, allowing us to focus on higher-value work.
Evercore ISI analyzed over 160 million US jobs across 800 occupations to determine each role’s exposure to AI. They found that AI could contribute to 32% of each job’s responsibilities on average. However, AI’s impact varies significantly by occupation:
- High-paying professional services jobs like law, finance, engineering, and management consulting have high AI exposure. AI can automate routine analytical tasks, empowering workers to be more creative and strategic.
- Lower-paying service jobs like food service, cleaning, healthcare support, and transportation have lower AI exposure as they require significant human interaction and emotional intelligence.
This research confirms AI will transform high-value office jobs through augmentation versus predominantly replacing low-wage positions. white-collar workers should embrace AI as a productivity enhancer rather than a job threat.
The key perspectives around AI’s effects on work.
Optimizing Human-AI Collaboration
Rather than full automation and replacement, the most promising pathway is optimizing collaboration between humans and AI. Humans have unique capabilities in areas like creativity, empathy, and cross-domain thinking that AI still struggles with. On the other hand, AI excels at processing large datasets, performing repetitive tasks, and generating new content or ideas.
By combining the complementary strengths of humans and AI, businesses can achieve greater productivity and innovation. For instance, AI writing assistants like GPT-3 can help human writers research and draft content more efficiently. AI image generators can rapidly create visual concepts for designers to refine. Knowledge workers across fields like law, consulting, finance, and technology stand to benefit from AI’s ability to analyze data, suggest options, and automate rote tasks.
Effective human-AI collaboration requires adapting processes and mindsets. Companies will need to clearly delineate the division of labor between humans and AI systems. This allows each to focus on their comparative strengths. Workers may also need retraining to effectively leverage AI tools. Adopting an open mindset and proactively looking for opportunities to integrate AI can help smooth the transition.
Preparing the Workforce with New Skills
Another key priority is equipping workers with skills suited for the AI-powered workplace. As the Evercore ISI study found, highly cognitive roles like computer programming, finance, and law tend to have high AI exposure. However, rather than full replacement, integrating AI can make these workers more productive and empower them to focus on higher-value work.
For example, a financial analyst leveraging AI to analyze data and spot trends could spend more time formulating strategic recommendations for clients. A software engineer using AI code generation tools can devote more effort to refining and optimizing the overall program architecture.
To maximize these productivity dividends, workers should develop skills like:
- Understanding how to use AI systems and integrate their outputs into decision-making
- Identifying opportunities to deploy AI for enhanced productivity
- Validating and critiquing AI-generated content
- Communication, creativity, and cross-domain thinking to complement AI capabilities
- Continuous learning to stay updated on evolving AI systems
With the right skills and mindset of human-AI collaboration, professionals across many fields stand to become more empowered by AI.
Managing the Downsides of AI Disruption
However, the rise of AI also risks disrupting some jobs and industries more negatively. Lower-skill routine jobs are more susceptible to full automation, as we’ve already seen with manufacturing robots and self-checkout. AI also creates uncertainty for workers in roles that may see their demand reduced due to AI capabilities.
There are several ways policymakers and companies could help mitigate AI’s downsides:
- Providing training programs and continuing education to help displaced workers transition into new roles. This is preferable to simply automating a job and leaving the worker stranded.
- Exploring protections like universal basic income to support those who lose jobs to automation and face barriers re-entering the workforce.
- Embracing a more holistic view of AI that considers ethics and workforce impacts rather than narrowly chasing efficiency gains.
- Implementing AI gradually to allow smoother transfers rather than sudden, large-scale workforce disruption.
- Ensuring AI bias testing and auditing to avoid a disproportionate impact on marginalized groups.
With thoughtful policies and responsible adoption, societies can maximize the benefits of AI while supporting those negatively affected by disruption. The goal should be empowering as many people as possible for the AI-driven future.
New Opportunities in the AI Economy
In addition to transforming existing jobs and companies, AI will spur entirely new opportunities and industries. An area to watch is AI startups using generative AI to build new products and services. As the article notes, while large enterprises may capture most of the market value from AI over the next decade, startups also stand to benefit.
Creative fields like media, education, and entertainment could see new applications of generative content. Niche vertical AI startups will emerge to develop tailored solutions for industries from law to real estate. New types of roles and careers will arise to support, maintain, and derive insights from AI systems. Education and governments should foster these emerging opportunities through funding research, supporting startups, and offering related training programs.
Rather than a wholesale replacement of human jobs and skills, the promise of AI lies in augmenting and enabling human capabilities. With prudent policies and responsible adoption, societies can navigate an inclusive transition into the age of artificial intelligence.
AI: The Solution to Declining Productivity
AI comes at a critical time as developed nations face slowing productivity growth, declining birth rates, and aging populations. From 1960-2009, US productivity saw steady gains, but it plateaued over the last decade. Combining this with shrinking workforces creates a major economic hurdle.
The Evercore ISI team estimates AI could boost global GDP growth by 2032. By augmenting human capabilities, AI allows us to generate more value with fewer workers. This will be crucial to supporting aging populations with smaller working-age cohorts.
Already, management consultancies and Wall Street banks are pioneering AI augmentation to empower employees. Law and professional services firms are also exploring opportunities, albeit slowly due to cultural resistance. Proactive adoption by business leaders will determine who thrives in the AI economy.
The AI Impact Across Industries and Job Functions
To help businesses navigate AI’s impact, Evercore ISI developed the AI Impact Navigator. This tool analyzes any Russell 3000 company’s workforce composition to determine its exposure to AI augmentation.
The results reveal AI will disproportionately affect some industries:
- High AI exposure: Finance, Business Services, IT, Healthcare, Education, Media
- Lower AI exposure: Manufacturing, Retail, Transportation, Construction, Food Services
Within industries, AI’s impact varies by occupation:
- Finance: High for analysts, investors, financial managers. Lower for tellers, loan officers.
- IT: High for software developers and engineers. Lower for technical support.
- Healthcare: High for practitioners and technical roles. Lower for personal care aides.
- Education: High for professors and teachers. Lower for janitorial or food service staff.
The Navigator provides business leaders with data-driven insights to develop an AI strategy focused on maximizing augmentation benefits.
The Future of Work: Humans and AI Collaborating
The emergence of AI gives us an opportunity to reimagine how humans and technology interact and collaborate. When human strengths are combined with AI capabilities, the results can be multiplicative.
As Tutello, an education technology startup, experienced, AI development tools helped engineers triple productivity. This freed them to focus on higher-level tasks. Larger companies stand to gain even more, with one organization projecting $750 million additional EBITDA from human-AI collaboration.
Rather than AI assistants replacing humans, we will progress towards AI acting as collaborators. Technologies like GitHub Copilot allow AI and humans to work together to write and refine code. The future will bring even more intuitive human-AI collaboration.
Leading with Insight and Optimism into the AI Era
AI will usher in a new era of innovation and progress. However, thoughtfully managing the transition will determine whether AI unlocks shared prosperity or exacerbates inequality. Business leaders who proactively reskill workers and integrate AI to augment capabilities will thrive. Policymakers must also support displaced workers and nurture new opportunities.
If adopted equitably, AI can drive inclusive economic gains by boosting productivity, helping address demographic challenges, and allowing humans to focus on meaningful work. Although AI will transform our economy, humans will remain at the center of guiding this change. By adopting AI wisely and optimistically, we can build an augmented future that benefits all.
Key Policy Recommendations
In summary, here are some key takeaways and recommendations from this analysis:
- The rise of advanced AI will transform work across industries. Leaders in areas like law, finance, consulting, and technology are already exploring integration.
- AI’s greatest value is enhancing human capabilities through collaboration, rather than full automation and replacement of jobs. Workers should prepare with skills for effective human-AI collaboration.
- Lower-skill routine jobs face the highest risk of negative disruption through automation. Policymakers should provide training programs and continuing education to help displaced workers transition.
- Thoughtful integration of AI that considers workforce impacts is preferable to rapidly automating jobs without a plan for workers. Gradual adoption allows smoother transfers.
- New opportunities will emerge from AI across startups and creative fields like media, education, and entertainment. Fostering these opportunities can counterbalance job losses in other areas.
- With prudent policies, responsible adoption, and smart collaboration between humans and AI systems, societies can maximize productivity and empowerment for the future.
Key Takeaways:
- AI will transform high-value office jobs through augmentation rather than replacing low-wage roles. White-collar workers should see AI as an enhancer.
- Slowing productivity and shrinking workforces create economic headwinds. Thoughtfully adopted AI can drive productivity gains to support aging populations.
- The Evercore AI Impact Navigator provides data-driven insights for companies to develop an augmentation-focused AI strategy.
- Maximum benefits will come from integrating AI to enhance human strengths. The future is AI and humans collaborating, not AI replacing humans.
- Business leaders must proactively transition their workforce and integrate AI to drive inclusive economic gains.
