Saturday, April 5, 2025

UN Warns of Economic Productivity Decline Due to Job Losses from AI

The United Nations recently shared insights on technology, emphasizing that a key aspect of artificial intelligence (AI) is its potential to enhance human intelligence. AI can boost collaboration between humans and machines, potentially leading us into a fifth industrial revolution. However, this progress also comes with concerns about job losses.

According to their Technology and Innovation Report 2025, a wave of change is set to reshape both the economy and society. The report cautions that while AI could streamline many processes, it might displace a significant number of workers without creating enough new jobs to replace them. The report specifically highlights issues around job polarization and growing income inequality, especially in developed nations. For instance, the UK faces challenges as many jobs in professional and managerial fields are particularly vulnerable to AI advancements. It also points out that roles in clerical support and technical positions are likely to see automation impacts.

The report brings up a concerning issue of tech inequality. Nearly half of the jobs that could benefit from AI face digital hurdles. There’s also a notable gender imbalance; women are often in the roles most exposed to automation. They are twice as likely as men to hold jobs at risk from these changes. This digital skills gap may prevent women from reaping AI’s benefits, perpetuating existing inequalities. The UN emphasizes that while AI can enhance productivity, the actual uplift depends on how the labor market adapts over time. If AI primarily replaces jobs, we could see a decline in employment in sectors where AI is most prevalent, leading to further economic disparities.

While AI could boost productivity in certain areas, the overall economic gains might be limited by slower growth in less tech-intensive sectors. The UN suggests that for a more balanced transition, governments should invest in AI technologies that complement human workers. This includes increasing funding for research and development, making strategic public purchases, and offering targeted tax incentives. Additionally, creating better job opportunities and clear career paths can help prevent a talent drain.

The report also examines the landscape of AI development, noting that major semiconductor companies predominantly hail from the US and developed economies. The US controls about a third of the top 500 supercomputers, dominating global computing power. China comes next with 80 supercomputers, but its capacity is still significantly smaller than that of the US.

Most developing countries struggle with limited AI infrastructure and hardware, making it hard for them to keep up. This raises questions about supply chain vulnerabilities and the urgency for nations to achieve autonomy in technology crucial for their development goals.