Changing Landscape
This presentation is a painting of changing Landscape with Economics as its canvas.
Work is to do some activity using physical and mental efforts which results in earning an income for fulfilling set desires. When the word income is removed then work becomes a routine human activity which is simply out of the scope of economics.
Workforce is the total number of human resources available within a nation which can be deployed for work both within the nation and on a global scale.
This Workforce is supposed to be dynamic, in this state all available human resources are put to some kind of work which generates an income. In a static state even if human resources are available, they are not put to use to generate any income.
In a healthy economic state, the maximum percentage of its human resources are put to use as a dynamic workforce to generate income, this can be both within that nation and also on a global scale.
As the percentage of dynamic workforce start to decrease and move into a static state it causes a change in the economic landscape of that nation.
Total Workforce = Dynamic Workforce + Static Workforce
It is important for a nation to monitor its total workforce. More the dynamic workforce more will be the income generated and it will also assist is supporting the static workforce resulting in a safe and functioning economic system.
But in a situation where the static workforce keeps increasing and the dynamic workforce keeps reducing then income will be hurt resulting in a situation where the burden to support the total workforce causes an immense stress on the economic system.
Is the fear of AI taking over many jobs a reality? If yes, then will it be a threat to the workforce?
“Total Workforce = Artificial Intelligence + Dynamic Workforce + Static Workforce” is the new equation
“Total Workforce = Artificial Intelligence + [Dynamic Workforce + Static Workforce]” is a threat condition.
“Total Workforce = [Artificial Intelligence + Dynamic Workforce] + Static Workforce” is not a threat condition. Here the static workforce needs to be moved into a dynamic workforce with more emphasis on adaptability, skills training and development.
AI is an application of technology in workplace. The use of AI technology ensures maximum productivity with minimum wastage. This will reduce the operational cost and enhance profits. Major component of the operational cost is the labor cost. When labor cost is reduced it can either be in the form of layoffs or reduced pay package.
Layoffs will only enhance static workforce, and reduced pay package will diminish the purchasing power. Diminishing of purchasing power will slow down the economic cycle. The threat of AI taking over many jobs is something that cannot be simple set aside.
Administrators, regulators and the economist have to start working on a new economic model which will ensure smooth and uninterrupted functioning of the economic cycle by integrating the workforce to maximize income under any changing conditions.
It is not a threat when 100 hands and 200 chisels are available to carve and cut, but it is a threat when 100 hands and 200 chisels are available and nothing to carve and cut.