Are Algorithms the New White-Collar Workers?
We are entering a new era where algorithms are increasingly taking the role of white-collar workers with automation and artificial intelligence (AI) systems handling tasks previously done by humans. According to a recent study by the McKinsey Global Institute, up to 800 million jobs worldwide could be displaced by automation by 2030, with white collar positions particularly at risk. According to a very interesting book (A Human Algorithm) by Flynn Coleman, “we are alarmingly unready for the reality of powerful AI that reaches conclusions and decisions independent from human intervention.”
If we take a step back, our brain acts as an orchestrator of complex decision-making process executed with the help of years of learnings, observation, and our anecdotal evidence of own reality based on our surroundings. Modern algorithms are smart enough to bite size this decision-making process and execute a specific set of tasks with a lot of accuracy and precision. As humans, we can beat an AI system or the underlying by just the sheer number of pre-built decision-making models built into our brains. But by scaling these algorithms (already being done by many organizations), you could see how the lines are getting blurry between a white-collar worker and an intelligent AI system powered by complex set of algorithms.
Some core examples of this already happening in various industries:
1. The financial industry is one area where algorithms have already made significant inroads. A report by the Boston Consulting Group found that in the securities industry, algorithms now execute 60–70% of all trades. In the mortgage industry, sophisticated algorithms can process loan applications in a fraction of the time it would take a human underwriter.
2. The legal profession is also feeling the impact of automation. A study by the University of Oxford found that nearly 40% of legal jobs in the United States are at high risk of being automated. This includes tasks such as document review and contract analysis, which can now be done by AI systems with a high degree of accuracy.
3. The healthcare industry is another area where algorithms are playing a growing role. In a recent survey of hospital CIOs, nearly 40% said they were using AI to help with diagnostic imaging and radiology. Another survey found that nearly 70% of healthcare professionals believe AI will have a significant impact on the industry within the next five years.
In an ongoing supreme court battle, this is precisely the heart of the argument of big tech companies. Given where every part of our lives is impacted by algorithms, there is an argument that what happens if things do not go as intended by the original design of an algorithm. Just like a human is responsible and accountable for an unintended outcome, are algorithms also responsible for any unintended consequences? See here an interesting article on CNN about this story.
While the displacement of white-collar jobs by algorithms may seem concerning, there are also opportunities for workers to up-skill and take on new roles. A report by the World Economic Forum found that while 75 million jobs may be displaced by automation, 133 million new roles could be created. These new roles will likely involve working alongside algorithms and AI systems. These are jobs that may sound weird at first will require day to day skills that we take for granted today.
New jobs such as prompt engineering, bias arbitrator, human recourse specialist, personal entertainer, professional apologizer might be new professions by the end of this decade.
It is currently difficult for AI and algorithms to replicate other soft skills including human thought leadership. But algorithms and AI systems can perform tasks such as data analysis and decision-making with a high degree of accuracy, they do not possess the same level of creativity, intuition, and emotional intelligence as humans. Human thought leadership involves a unique combination of skills and experience, including the ability to think critically and strategically, to communicate effectively, and to inspire and motivate others. These skills are difficult to replicate with current technology.
In conclusion, the rise of algorithms and AI is having a significant impact on white collar jobs, but with the right skills and training, workers can adapt and thrive in this new environment. It’s important for businesses and governments to invest in retraining programs and education to help workers make the transition to a time when we are not only competing with our peers for jobs or opportunities, but we are also competing for a place on the table with a quantum computer powered algorithm on the other side.
