The Bank of England's Chief Economist Andy Haldane warned on Monday that the rise of artificial intelligence (AI) threatens to replace a huge number of jobs.
Haldane said that the so-called Fourth Industrial Revolution — a digitally-driven paradigm shift similar to previous industrial revolutions in the West — had the potential to displace numerous jobs and leave people "technologically unemployed."
"Each of those [industrial revolutions] had a wrenching and lengthy impact on the jobs market, on the lives and livelihoods of large swathes of society," Haldane told the BBC.
The BOE economist cautioned that previous industrial revolutions resulted in "heightened social tensions," "financial tensions" and "inequality." The First Industrial Revolution, which took place during the Victorian era, transformed Britain's economy, leading to the creation of ground-breaking industrial innovations including the steam train and advanced machine tools, all the while resulting in layoffs especially in industries like textiles.
"This is the dark side of technological revolutions and that dark side has always been there," Haldane added. "That hollowing out is going to be potentially on a much greater scale in the future, when we have machines both thinking and doing — replacing both the cognitive and the technical skills of humans."
While Haldane did not pinpoint a figure for the number of jobs he thought might be replaced, he said it would likely be "at least as large" as the unemployment levels from previous industrial revolutions. The economist said there was a need for the creation of new jobs and upskilling in order to avoid redundancies.
Haldane is not alone in warning of the impact of AI on the labor market. It is one of the biggest concerns held by experts in the field.
Research firm Gartner has predicted that AI will create 2.3 million jobs and eliminate 1.8 million — a net increase of 500,000 jobs — by 2020. However, that doesn't throw out the fact that it would result in steep layoffs around the world.
And some are less optimistic. Deutsche Bank's former chief executive, John Cryan, warned last year that "a lot of people" in the banking industry would lose their jobs due to automation. He suggested that thousands of his own employees could be replaced by AI.
Some commentators — particularly within the tech industry — argue that the introduction of a universal basic income will be necessary to offset the effects of mass job losses. Finland had trialed the scheme, which promotes a universal welfare system in place of all existing benefit programs, but earlier this year said it would not extend the program and end payments to recipients at the start of 2019.