The relentless quest of humanity for progress has brought us to the 4th Industrial Revolution of AI and other related technologies. Today, the world is witnessing technological innovation and growth at an unprecedented rate. Are we ready for all the changes this growth will bring?
The economic downfall of the Roman Empire shows what the failure to adjust to changes can bring. The Romans replaced much of their workforce with free slave labor. The result was widespread unemployment for their citizens which contributed to the collapse of the empire. We are in a mirror position as AI-based solutions threaten to displace human labor even though productivity will rise.
Industries are set for huge economic benefits from the improved efficiency and time-saving operations that will result from automation. However, with increasing automation is the worry that the humans who used to fill these tasks will be displaced. The World Economic Forum estimates that 75 million jobs will be displaced by AI even though 133 million new ones will be created by 2022. Job loss will have economic consequences for affected people during the transitory time it takes for new jobs to be created. Technically, this is a familiar script. Large-scale automation has happened before and human labor simply transitioned into new roles. In this regard, the past does not serve as a good predictor of the future because the rate at which jobs will be displaced will be much faster than they are created. This transitory stage will almost certainly not be smooth.
It thus becomes obvious that on one hand are the large enterprises (along with their top executives) set for huge economic gain while on the other hand are those whose jobs AI will take over. Who then benefits from AI growth? Is the 4thIndustrial Revolution about to create the widest income gaps in human history? If so, is there a way around this? It would be far-fetched to suggest that progress in the field of AI be halted. AI solutions are good news for humanity as they will make people happier, safer and healthier. The focus, therefore, should shift to the labor force whose skills AI will render obsolete. This is because the expectation is that globally, 800 million jobs will be displaced by AI over the next decade. That is a staggering number of affected people.
As huge as this problem is, not everyone is paying attention and even fewer know there is a problem on the horizon. This is where AI leaders of today must step up to educate the people and the government about the problem at hand and also suggest measures necessary to smoothen this transition within the job market.
A solution that has been proposed by prominent global voices such as Barack Obama, Elon Musk, and Bill Gates is the “Universal Basic Income (UBI)”. With the changes set to happen within the job market, UBI could be a necessary response rather than a luxury. Policy makers could use it as a vehicle to redistribute wealth from large enterprises to labor through higher taxation on capital.
Universal Basic Income (UBI)
Universal Basic Income (UBI) is the concept that a regular fixed cash transfer payment be provided by the government to every citizen or resident, regardless of their financial or employment status.
The concept of UBI is built on:
· Universality: Everyone should benefit from a basic income.
· Individuality: Everyone refers to sole individuals rather than households.
· Unconditionality: Not tied to factors that serve as exclusions for anyone.
Benefits of UBI
In today’s world, most of a person’s activities are geared towards ensuring financial security. This includes going to school, career selection, etc. Many people have to choose between pursuing what they are truly passionate about and choosing a career path that guarantees financial stability. In a labor market dominated by AI and with the support of UBI, many more people will be able to chase their passions rather than training for jobs they have no interest in. Furthermore, this financial freedom to engage in activities that people want to do rather than need to do will boost entrepreneurship which could in turn contribute to the growth of the economy.
Over the next decade, global GDP may witness as much as a 40% (or $15.7 trillion) boost by the year 2030 according to PricewaterhouseCoopers, income-distributing tax policies could ensure that the UBI citizens receive is even above the poverty line. If this can happen, then UBI may contribute to eliminating poverty. If people can afford to cater to their most basic needs, it is feasible to project that crime rates could also drop and overall well being improved.
Another point in favor of UBI is the reduction of gender inequality. Economic power, or lack thereof, has played a major role in gender gaps. With the balance provided by UBI and the equality of payments to both genders, economically disenfranchised women will have income stability and autonomy.
Downsides of UBI
The biggest of UBI’s critics argue that guaranteeing financial stability is taking away the incentive of people to work. They state that the fear of lack is a potent motivator for the workforce. If a person retains the awareness that their next meal is tied to their labor (whether intellectual or manual), their drive to contribute to the labor market is increased.
Another criticism is that of the cost. Regardless of what the UBI is set at, governments would have to decide how to fund the programme. How would the costs be sustained? This is of particular concern in regions of the developing world such as Africa and the Middle East which are still considered consumers of these emerging technologies which are produced by US, Canada, China and other developed countries. Even in areas like the United States or Japan, UBI would prove difficult to implement due to high debt profiles.
Furthermore, critics question the ethics of providing what is termed as “free money” for citizens. If challenges are taken away from the human experience, are we not in essence losing some of those qualities that make us human?
Both sides of the argument raise valid concerns.
UBI a logical response to an awareness of an economic reality that not enough new jobs may emerge to replace displaced jobs but it requires that considerations be made. To be successful, there will be implementation challenges to overcome. For example, the rate of adoption of AI solutions will vary across continents and even within regions of the same country. Not all nations of the world will have the financial capacity to fund UBI. Estimations will have to be made about how much will be considered “enough” to fund the average citizen’s basic needs.
Other proposed solutions to prepare for the future other than UBI is to strengthen our education systems towards AI education. Massive online educational AI platforms such as Fugen.ai, an initiative by are leading this shift towards educating students about AI and data science to prepare them for the future to come.
The future is here already and nations cannot afford to be caught off-guard by the short-term job market disruptions that will be caused by AI. The progress of AI should not be slowed. To do that would be to lose the core drive towards progress that humans have. Starting conversations such as UBI is necessary to challenge the government to play its role as a key regulator of capitalism and guardian of the social welfare of citizens.
A way forward to the future economy can only come from policies and all source of innovations yielded from cross-disciplinary collaboration.
This article was originally published by the author on LinkedIn: https://www.linkedin.com/pulse/ai-jobs-universal-basic-income-samer-obeidat-mgm/?trackingId=lrZFsIg3QAi5cHmVa1HPew%3D%3D