Artificial Intelligence (AI) has emerged as one of the most cathartic technologies to have ever existed, transfiguring the various sectors of the economy. It has transcended our understanding of what was traditionally understood as ‘intelligence’. AI has seeped into various sectors, impacting at the core, its creators – ‘Humans’. In this blog, we shall unravel the hidden layers of AI and its role in reshaping the labour market.

Artificial Intelligence can be considered as a General Purpose Technology (or GPT), a concept developed by Bresnahan and Trajtenberg (1992). AI has a wide range of capabilities and applications. It can work on automation to perform repetitive tasks and processes, saving time whilst reducing human labour. It also tends to understand and process human language, using its Natural Language Processing (NLP) technique.

Improvement in Technical Performance Benchmarks

In a world where the intelligent AI army works in collaboration with the human race, a plethora of changes can take place, replacing the repetitive and mundane tasks from the human being’s to-do list to concentrate on a range of other tasks that serve to be more complex and meaningful than others. AI-powered robots and virtual assistants have arrived to offer greater efficiency and accuracy leaving no flaws behind, helping human progress by finishing up  tasks which otherwise took most of their time and energy. Nothing can match the example of the medical industry, cancer was once seen to be an incurable disease, but with the collaboration of AI and Doctors the death rates have not only been reduced from 89.6% to 87.9 % but it also provides a counter treatment that has benefited the population with a success rate of more than 79% (Guze, S. B., 1995).

A sense of collaboration between AI & Humans

Contrary to regular belief, AI is not here to steal your jobs! It is here to collaborate and give you the best of both worlds. AI brings to us a revolution of automation which has helped to identify patterns that seemed otherwise impossible to detect. This collaborative partnership between humans and AI brings about a transformative shift, unlocking untapped growth potential and seizing innovative opportunities. It empowers workers to make informed decisions and firms to upskill their workforce

But let’s not forget that every rose has its thorn, and so does AI. It offers a range of difficulties to the traditional workers, who are yet to upskill to their true potential. The labour force is required to understand the functionality and ideation process of the automated technology so that they are not left behind. A world of collaboration calls for higher flexibility and better adaptation so that the labour force keeps the risk of losing their jobs at arm’s length. If we lay our eyes on valid evidence, it is clear to see that the manufacturing industry has seen a rapid rate of unemployment touching almost 47% in the U.S. and Japan with the rapid movement of technology replacing labour, who is not skilled enough to adapt to the changes (Cichocki & Kuleshov, 2021).

The Hypercycle of AI

The concept of the “hypercycle” in the context of artificial intelligence (AI) refers to a cycle of rapid advancements and improvements in AI technologies, leading to a self-reinforcing feedback loop of progress. The hypercycle is often associated with the idea of exponential growth, where each iteration builds upon the previous one and accelerates the development of AI.

Why should employees Upskill?

In a world dominated by AI, the human touch is inexorable, none can replace the empathy, emotional intelligence and wide-ranging interpersonal skills that humans contain. While it is understandable that machines have excelled in pattern analysis and task execution it is inevitable to forget the forging connections and personal experiences which have shaped the world till date. AI is not a tool of replacement that shall wipe out the human race, but it is one of complement integration that shall prove to integrate and enhance the quality of work, not forgetting the human significance while doing the same.

As the impact of AI spreads, it is only likely to accelerate in the coming years. This raises a series of concerns for policymakers who are responsible for ensuring that the benefits of AI are spread widely across all domains and in the process mitigating the risks and threats. 

The two major concerns are unemployment and inequality, as AI is well-versed in finishing tasks at a much faster pace, the labour market is getting severely affected as unemployment rates are building up, this can be understood with the help of “The Productivity Paradox”,  a period of technological advancements that might not be followed with the best interest for job creation usually taking place due to displacement of the labour force due to inability in matching the technological progressions as well as the automation of repetitive tasks. This impact shall vary across sectors, such as the manufacturing, transportation, data entry and customer service where this displacement has been fast paced due to the availability of robots and virtual monitors taking up most of the jobs. Technological progression has a historical record of job-losses and job – creation. The invention of motor cars led to significant job-losses for the horse-drawn carriage industry, including coachmen, blacksmiths, and stable workers. 

However, it is important to notice that the automobile industry led to employment opportunities for mechanics, salespeople, and service station attendants. Those who are already well equipped with technology are benefitting from the changes, while those who cannot afford such training are left behind. Policymakers must address both these issues and make training and skill development more easily available to the public, especially those who cannot afford it. Also the policymakers should focus on providing unemployment support to those who got displaced by AI. It is necessary to regulate the use of AI by reducing biased algorithms that discriminate against certain groups of people and reducing privacy concerns.

Brace for a  bitter-sweet Impact

AI has an undeniable impact on the labour market, bringing forth both opportunities and threats. For some sectors AI may create overwhelming concerns by creating unemployment whereas for other sectors it has created a positive impact by generating better employment opportunities. 

It  has been particularly useful in conducting ground-breaking research in the medical, finance and educational sectors, which could have taken years if it were performed manually. AI poses ethical threats such as privacy and security breaches.. The impact of AI calls for a balanced approach such that we embrace its uses, whilst still protecting individuals from its horrendous peril’s. As custodians of AI, it is incumbent upon us to take responsibility for its use and its impact. It is our duty to ensure that AI is harnessed to unlock innovative solutions, enhance productivity, and create a brighter future. AI is not without its challenges but with the right mindset, a collaborative attitude and commitment towards learning, AI can unlock human potential to an unprecedented scale.


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Khushi Tangri

[email protected]

B.A.(H) Economics, 1st Year

Indraprastha College for Women, D.U.