The International Monetary Fund (IMF) has said that apprenticeship and skill development will help mitigate the initial surge in unemployment from the massive adoption of Artificial Intelligence (AI).
IMF advised governments that AI transition would require stronger social safety nets, investment in education, and tax systems that support human workers and mitigate inequality.
The Washington-based lender said this on Monday in a report published by the Deputy Director, Fiscal Affairs Department, Era Dabla-Norris and Ruud de Mooij, who is also a Deputy Director, IMF’s Fiscal Affairs Department.
The report said, “While AI could eventually boost overall employment and wages, it could put large swaths of the labour force out of work for extended periods, making for a painful transition. Lessons from past automation waves and the IMF’s modelling suggest more generous unemployment insurance could cushion the negative impact of AI on workers, allowing displaced workers to find jobs that better match their skills.
“At the same time, sector-based training, apprenticeships, and upskilling and reskilling programs could play a greater role in preparing workers for the jobs of the AI age. Comprehensive social-assistance programs will be needed for workers facing long-term unemployment or reduced local labour demand due to automation or industry closures.”
The IMF directors said there would be differences in how AI impacts emerging-market and developing economies.
The lender noted that workers in developing and emerging countries are less exposed to AI.
However the IMF directors said their workers are also less protected by formal social-protection programs such as unemployment insurance because of larger informal sectors in their economies.
“Innovative approaches leveraging digital technologies can facilitate expanded coverage of social assistance programs in these countries,” They added.