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The widespread adoption of artificial intelligence (AI) is likely to displace people from jobs in a similar way seen during the Industrial Revolution, the governor of the Bank of England has said.<\/p>\n
Andrew Bailey said the UK needed to have the “training, education, [and] skills in place” so workers could shift into jobs that use AI.<\/p>\n
He told BBC Radio 4’s Today programme that people looking for a job would find securing employment “a lot easier” if they had such skills.<\/p>\n
However, he warned that there was an issue with younger, inexperienced professionals finding it difficult to secure entry-level roles due to AI.<\/p>\n<\/div>\n
“We do have to think about: what is it doing to the pipeline of people? Is it changing it or not?” he said.<\/p>\n
“I think if it’s people working with AI, I’m not sure it will change the pipeline, but I think we’re right to have an eye on that point.”<\/p>\n
AI has become part of everyday life in recent years and is increasingly being adopted by businesses and the public sector. <\/p>\n
The technology allows computers to process large amounts of data, identify patterns and follow detailed instructions about what to do with that information. <\/p>\n
However, there are concerns over the impact it may already be having on the jobs market.<\/p>\n
Official figures released this week revealed the UK unemployment rate rose to 5.1% in the three months to October, with younger workers particularly affected<\/a>.<\/p>\n The number of unemployed 18 to 24-year-olds increased by 85,000 in the three months to October, the largest rise since November 2022, according to the Office for National Statistics (ONS).<\/p>\n Some have argued rises to the minimum wage and increased taxes has made it less appealing for businesses to hire entry-level staff. <\/p>\n However, some firms have said the growth of AI may eventually lead to fewer junior staff, particularly graduates being hired.<\/a><\/p>\n Entry-level professional jobs are thought to be most impacted by AI, particularly in sectors such as law, accountancy and administration.<\/p>\n The boss of accountancy giant PwC recently told the BBC that the firm<\/a> was scaling back plans to increase its headcount.<\/p>\n “Now we have artificial intelligence. We want to hire, but I don’t know if it’s going to be the same level of people that we hire – it will be a different set of people,” said global chairman Mohamed Kande.<\/p>\n Firms who would have previously contracted PwC consultants to sift through data and documents may now use AI models instead, turning weeks of costly work into minutes.<\/p>\n Mr Bailey said worries over the impact of technology on populations cropped up at various times in history, stretching back centuries to when Queen Elizabeth I was worried about the impact of the invention of the knitting machine on her then subjects.<\/p>\n “As you saw in the Industrial Revolution, now over time, I think we can now sort of look back and say it didn’t cause mass unemployment, but it did displace people from jobs and this is important. <\/p>\n “My guess would be that it’s most likely that AI may well have a similar effect. So we need to be prepared for that, in a sense.”<\/p>\n Mr Bailey said AI was the “most likely source of the next leg up” for UK economic growth.<\/p>\n “In terms of its potential to improve productivity growth, I think it’s pretty substantial. It will get used across the economy. How quickly it comes through is another question, history would suggest that it does take some time.”<\/p>\n Mr Bailey said the Bank of England, which sets UK interest rates, was using AI but added the institution, along with others, were “probably all still experimenting”.<\/p>\n “To get it into sort of mainstream, everyday use will take some time, but it’s critically important that we obviously focus on getting the pre-conditions and all the conditions in place for that to happen,” he added.<\/p>\n<\/div>\n Aside from the jobs market being affected by AI, there are concerns there could be an AI bubble – whether the big tech firms are being overvalued.<\/p>\n The Bank of England has recently sounded the alarm over a potential crash in the value of AI firms, reminiscent of previous incidents such as the dotcom bubble.<\/p>\n