Impact of AI on Employment and Widening Disparities among Nations: UN Warns of 40% Workforce Disruption

Information from the United Nations Conference on Trade and Development (UNCTAD) predicts that the market value of AI is expected to reach a staggering $4.77 trillion by 2033, equivalent to the economy of Germany, which will boost productivity and drive innovation.

However, the benefits of AI are not evenly distributed, as they mainly favor large companies and wealthier countries, potentially leaving developing economies struggling to keep up. One major concern is job displacement, as AI could impact up to 40% of global job positions, with automated systems being more beneficial to businesses than employees. This widening income gap could lead to cheaper labor in developing countries, resulting in loss of competitive advantage, as warned by the IMF and the World Economic Forum in January, stating that 41% of employers are planning to downsize where AI can efficiently substitute.

Moreover, 40% of global spending on AI research and development is concentrated in just 100 companies, predominantly in the United States and China, such as Apple, NVIDIA, and Microsoft, all profiting from the AI growth with a value equivalent to the GDP of entire African countries.

This highlights the economic power being concentrated in a few organizations, especially in the Global South countries that are not actively participating in crucial AI policy discussions, potentially falling behind in the digital economy.

UNCTAD suggests that opportunities must be opened for developing countries to play a more significant role in AI governance, increase transparency by disclosing AI data publicly, and promote shared AI infrastructure.

Source: CNBC via UNCTAD

TLDR: The AI market is projected to reach $4.77 trillion by 2033, potentially benefiting large companies and wealthy nations more, while developing countries may face challenges due to job displacement and unequal distribution of AI resources.UNCTAD urges for increased participation of developing nations in AI governance and enhanced transparency in AI data sharing for a more inclusive approach.