When machines report for duty

Image: 123rf

Technology-driven job anxiety is not new. British textile workers feared mechanical loom technology in the late 1700s and early 1800s. Their fears were unfounded. The cotton gin eliminated hand-picking, but it created demand for textile machine operators.

However, artificial intelligence (AI) may be different in at least two critical ways. First, its speed. AI-powered assistant ChatGPT reached 100 million users in just two months after its launch, a number that took the telephone 75 years to reach. Second, its breadth. Unlike the steam engine, which replaced muscle, or the computer, which replaced clerical routine, AI is simultaneously threatening both white and blue-collar jobs, eg the radiologist reading an X-ray, the lawyer drafting a contract, the truck driver navigating a route, and the restaurant waiter taking food orders.

The evidence is catching up with the anxiety. Research released in 2022 by renowned labour economists Daron Acemoglu and Pascual Restrepo found that 50% to 70% of changes in the wage structure over four decades in the United States can be explained by task displacement from automation. The International Monetary Fund’s 2024 research estimated that about 40% of employment in emerging markets like Malaysia is exposed to AI disruption.

A 2020 analysis by global management consulting firm McKin-sey, conducted before the AI explosion, estimated that automation could displace the equivalent of 4.5 million workers in Malaysia by 2030.

In 2024, a national workforce study by the Human Resources Ministry’s talent retention agency TalentCorp identified 620,000 jobs at high risk of replacement, led by the wholesale and retail trade (245,000 jobs) and followed by the food manufacturing services (203,000), and global business services (89,000).

So what does adaptation actually mean in practice? It is not telling everyone to learn how to code.

A factory worker whose assembly line is now monitored by AI needs to learn to read the AI’s warning alerts and decide when to call for repairs. An accountant no longer needs to spend hours reconciling spreadsheets because AI does that faster. Now, accountants can devote their time to advising clients on complex tax structures. For would-be university graduates, a future-proof career strategy is to build real depth in their discipline while developing sufficient proficiency with AI tools.

How should the gaps be closed?

Employers need to not only invest in AI to cut costs but also invest equally in helping their workers adapt.

Trade unions need to negotiate employment contracts with the right to retraining when AI adoption changes a worker’s role, and not just the right to a redundancy severance payout.

The government needs to redesign schools and universities’ curriculum, and financial safety nets which allow AI-displaced workers to retrain without falling into poverty.

PROF DR SOON JAN JAN

Senior research fellow

Economic and Financial Policy Institute

Universiti Utara Malaysia