AI finishes more jobs than it makes, says Tiff Macklem
Date
11/21/2024 12:11:09 AM
(MENAFN) On Friday, Bank of Canada Governor Tiff Macklem raised concerns about the possible disruptive effects of artificial intelligence (AI) on the job market, warning that the technology might result in a net loss of jobs over time rather than creating new ones.
"As AI becomes more established in the economy and its impacts more transformative, it could end up destroying more jobs than it creates," he informed the National Bureau of Economic Research's Economics of Artificial Intelligence Summit conducted in Toronto, Ontario.
"And the people who lose their work to automation may struggle to find new opportunities," he further noted. "This is a concern for us all."
Macklem pointed out that understanding and shaping the industry market effects will be progressively significant as AI keeps advancing and diffusing through economies.
He further stated that AI could also impact how businesses set prices. "There is already evidence that digitally intensive firms change prices more frequently than less digitally intensive firms."
AI, moreover, may also impact the level of competition in the economy, even though its effect stays ambiguous, based on Macklem.
"Initially, AI-intensive start-ups could seize market share by undercutting incumbents. This would increase competition and lower prices. However, AI could also result in markets dominated by a handful of companies with monopoly power. In this scenario, AI would ultimately lead to less competition and higher prices," he clarified.
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