Don’t be afraid of robots, says World Bank

The World Bank has published a report annually since 1978. Each report focuses on a detailed analysis of one aspect of economic development and for 2019 the topic is robots and automation and how it is impacting on the world of work.

Bloomberg interviewed Pinelopi Koujianou Goldberg, the World Bank’s Chief Economist, about the report and one of her first statements was: “This fear that robots have eliminated jobs — this fear is not supported by the evidence so far.”

The fear arises from the fact that in the first world a substantial number of jobs have been lost in the industrial sector, while in East Asia the there has been a rise in employment in industry. The World Bank report notes the anxiety about job losses, but claims “the number of jobs lost to automation is about equal to the number of jobs created, even if technology is changing the nature of those jobs in several ways.”

In the World Development Report 2019: The Changing Nature of Work, World Bank Group President Jim Yong Kim said:

“The nature of work is not only changing — it’s changing rapidly. We don’t know what jobs children in primary school today will compete for, because many of those jobs don’t exist yet. The great challenge is to equip them with the skills they’ll need no matter what future jobs look like — skills such as problem-solving and critical thinking, as well as interpersonal skills like empathy and collaboration. By measuring countries according to how well they’re investing in their people, we hope to help governments take active steps to better prepare their people to compete in the economy of the future.”

Koujianou Goldberg also commented on the changing nature of work, telling Bloomberg: “This is the fourth industrial revolution, there have been three before, and in each case we managed to survive so it’s not the case that machines completely eliminated humans.”

However, not everyone agrees with the World Bank’s assessment of the situation with regard to a radical change in the types of jobs available. Gizmodo argues that the World Bank has not considered the quality of the jobs available, or the social and cultural impact of the loss of certain jobs and responds to the idea of robotics bringing a fourth industrial revolution as an idea to be treated with caution. Gizmodo also says, “There is a reason that many of the regions hit hardest by automation voted in the largest numbers for Trump.”

It also points out that reports like the one from the World Bank are useful as a window into how elites — i.e., those doing a lot of the automating — view mechanization.

What is clear that there are good arguments from both viewpoints and that what we need is dialogue between the two, so that we plan for an industrial revolution that is less harmful to those communities most affected by automation than in the past.

5 technologies disrupting banking by 2023

Over the next five years banking is going to change dramatically and will be nothing like we know it today. The changes will come due to technology and will provide financial institutions with both opportunities and challenges.

The global recession put a spotlight on banks; these institutions were largely responsible for the near-collapse of economies and although they have weathered the storm, people’s trust in them has not been restored.

Out of the failure of financial institutions came the bitcoin protocol and blockchain technology. This was followed by the arrival of fintech startups and neobanks, both of which threaten the consumer account monopoly enjoyed by retail banks, which is referred to as ‘legacy’ in the financial media. According to various consultancies, new players could capture up to a third of incumbent banks’ revenues in the next 2–3 years. If banks don’t respond to this, they are in danger of disappearing.

However, there is good news for the traditional banks: the new technologies that are threatening the banking industry also present significant opportunities. They can leverage big data and advanced analytics to improve customer experience, as well as build trust, loyalty and revenues. Dan Cohen, SVP at Atos, said: “Banks are at a crossroads. Continuous fintech innovation and new technologies such as blockchain are disrupting the market. While it creates threats, it also opens multiple opportunities for financial services to reinvent themselves and thrive.”

Here are five of the technologies that will advance fintechs and potentially cause more disruption in the banking sector, unless the banks are agile enough to incorporate them.

1. A hybrid cloud

Cloud computing tech has gone mainstream in banks pretty fast. It was found that at least 75% of bankers said their most successful cloud initiatives had already achieved expansion into new industries, creation of new revenue streams, and expansion of their product/services portfolio.

2. APIs

The combination of open platform banking and open APIs will change the entire banking ecosystem in its current state. In this scenario, the bank will serve as a platform, on top of which third-party companies can build their own applications using the bank’s data.

3. Robotic process automation

Robotic process automation (RPA) has helped banks and credit unions accelerate growth by executing pre-programmed rules across a range of structured and unstructured data.

4. Instant payments

Consumer demand for instant payments is on the increase. With instant payments, more transactions will be made digitally instead of in cash, which means that payments will become less expensive and more user friendly.

5. Artificial Intelligence (AI)

The benefits of AI in banks and credit unions are widespread, reaching back office operations, compliance, customer experience, product delivery, risk management and marketing to name a few

5 AI trends in 2019

As the use of Artificial Intelligence (AI) has grown in 2018, we can expect to see even stronger growth in the technology in 2019. One of the reasons it is bound to increase its presence in our lives is that it makes life easier, whether it is chatbots in business or Alexa in the home. According to Analytic Insightsand Forrester Research, in 2019 we will also “see the rise of new digital workers with an increased competition for data professionals with AI skills.” But, what else can we expect from AI next year?

More chatbots and virtual assistants

We will see more advanced use of AI virtual assistants on websites to answer customers’ queries and provide customer service assistance. For example, companies will create virtual agents with a face and personality to match to handle complex tasks to drive business, like, Autodesk’s virtual agent Ava has a female face with a voice that speaks emulating the company’s brand.

Improved speech recognition

Alexa may have started the trend, but in 2019 voice-activated services are going to be even bigger business. Already Sony, Hisense and TiVo have unveiled TVs that can be controlled by voice, and even home appliance makers such as Delta, Whirlpool and LG have added Alexa’s voice recognition skills to assist people control everything in their homes.

Smart recommendations

When we shop online we are already inundated with a series of recommendations about what to buy next based on our previous purchases. This is going to get bigger in 2019, with recommendations based on “sentiment analysis” as well as your search history.

Advanced image recognition

We can expect some is changes here in 2019. Don’t be surprised if there is image recognition to detect licence plates, diagnose diseases, and permit photo analysis for a range of verifications.

Cyber security

In 2019, expect artificial intelligence to be more powerful in fighting off cyber threats and prevent potential hackers. Companies including Darktrace have deployed and machine learning technologies to detect online enemies’ in real-time and identify cyber threats early on, and so prevent them spreading.

UK businesses struggle to keep up with AI

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A new report by Microsoft, published last week, indicates that artificial intelligence (AI) is changing business models so quickly that UK companies are struggling to keep up.

The tech giant surveyed 5,000 plus British business leaders and employees discovered that 41% of British companies surveyed said their business models might cease to exist in the next five years thanks to AI. Or perhaps ‘thanks’ is the wrong word; what they really mean is ‘due to’.

The report also revealed that 51% of the country’s business leaders do not have an AI strategy in place for their organizations, which is a significant proportion. This news comes at a time when British businesses are concerned about the outcome of the Brexit negotiations and could face tough, new challenges in a range of industry sectors.

As Clare Barclay, Microsoft U.K.’s chief operating officer, told CNBC, “Like any change, sometimes it’s easier to do nothing than to do something.”

On the other side of the factory floor, so to speak, employees have their own worries about the use of AI. Microsoft found that 45% of employees are concerned their job could be taken by AI, yet 51% are not being taught the skills to help prepare for changes in the workforce. Of course, this makes sense: if management is unengaged with AI, how can one expect employees to embrace it.

Barclay highlighted the problem as her company sees it, pointing out that AI is more of an opportunity than threat, and suggested UK businesses needed to “focus on this AI to make businesses stronger and, in our opinion, not leaner.”

Indeed the survey results show the benefit of AI. Companies already using AI technology outperformed other businesses in areas like productivity, performance and business outcomes. Moreover, companies that develop strategies around the ethics of AI are even more productive.

Microsoft is making big investments in AI and it also believes that companies like it can take the lead in helping others adopt the technology and develop “safe and ethical AI platforms, for example by ensuring that human bias isn’t built into algorithms.”

What is very clear is that UK businesses need to speed up their pace of adoption of AI and ensure they are equipped to face the future with a stronger technology foundation.