Fears of artificial intelligence from within the financial services may be justified, as research from the consultancy Opimas has indicated that as many as 230,000 capital markets employees could be at risk of being replaced by automation.
Although the adoption of automation technologies could lead to up to 30,000 new tech jobs, including data provider roles. However, the job losses to asset management alone are set to be close to 90,000.
These changes are being driven by increased spending from the banking industry on AI technologies including cognitive analytics, robotics and machine learning. Over the next year alone $1.5 billion is expected to be spent across the industry, climbing steeply to $2.8 billion by 2021.
A recent report conducted by Fujitsu found that 78% of UK financial services firms are worried about the future of their organisation when considering the impact of digital disruption. And 92% of financial services firms surveyed have already taken measures to thrive in a digital world.
The report from Opimas says: “Artificial Intelligence will provide a myriad of benefits to financial institutions, including improved operational efficiency and cost reductions. It will also upgrade legacy IT systems, improve data and analytics, enhance client services and increase revenue generation. We expect that by 2025, the rollout of AI technology by financial institutions will decrease the cost/income ratio by over 25% (see Figure 1), notably through a reduction of overall headcount.”
“Prioritising the uses of AI will be critical, as these technologies will benefit every business operation within financial institutions. The key to AI is not in finding uses but, rather, selecting the right area in which to start, based on the firm’s positioning. That sets it off from other “trendy” technologies in search of capital markets applications—Blockchain is a perfect example.”
The question remains regarding whether these vast changes will mean a substantial amount of other accessible jobs become available, or whether cost-effectiveness outweighs the requirement for human skills and cognition.