We are living in revolutionary times. Artificial intelligence (AI) is influencing our lives in a way that can only be compared to the transformational impact of the industrial revolution, or the inventions of the steam train, car, telephone and internet.
Computer systems that are designed to think like people are becoming more prevalent in society. Being programmed to learn, reason and problem solve means these AI algorithms can perform tasks that only people were once considered capable of doing, such as driving cars, dealing with customer complaints, recommending TV shows, translating text into different languages and even writing songs.
These algorithms, the most famous of which is ChatGPT, have the potential to enhance and improve all areas of society, from our personal lives to the commercial world, the military, healthcare and science.
For example, it can automate tasks such as processing invoices and packing customer orders faster in retail warehouses. They can help scientists make new discoveries and answer students’ questions in the classroom.
You could argue that as these algorithms are being developed to be smarter versions of the people who created them, they could have a bigger impact on society than industrialisation, the opening of the first commercial oil well and perhaps even the discovery of re.
Demand for such services is high. Indeed, AI is worth more than India and China’s combined GDP at $15.7trn (£12.3trn), PwC believes. Around half of this ($6.6trn) is expected to be generated by improved productivity, with the remainder from consumption.
Hot chips
To understand the strength of AI’s growth, we have to look at Nvidia, which makes chips for the applications algorithms run on. Its sales reached $18.1bn (£14bn) in the three months to the end of September – $12bn (£9.4bn) more than in the same period a year earlier. Analysis have been quoted as estimating that in the next two years, its revenues could break $60bn per annum.
“From my discussions with our managers, [AI] is going to be a massive game changer,” says Jennifer Devine, who is head of pensions at the Wiltshire Pension Fund. “They describe it as a paradigm shift.
“It is going to be a big deal and that is why we are taking a look at it. But we don’t know anywhere near as much as we would like to know at this stage in the game. There is just so much to talk about, whether it is a good thing or a bad thing.
“We have all seen Nvidia’s stock performance rocket and felt that we needed to dig a little bit deeper to explore some of the wider implications,” she adds.
But while AI offers the potential for great rewards, the potential risks are equally as high, if not greater. Putting machines in charge of our lives only for them to turn on us with often fatal consequences is the theme of many science fiction stories.
One example is Arthur C Clarke’s 1968 novel 2001: A Space Odyssey, where putting a computer in charge of a spaceship turned into a life-and-death battle for the crew. The computer attempted various methods to kill them after they tried to disconnect the system on fears that it was malfunctioning.
The computer uncovered the plot by lip reading a conversation. Then there are the Terminator films, where the US government putting a self-aware computer in charge of its defence system turned the world into a nuclear battle field after identifying humanity as a threat.
So is the world ready for such disruption to our lives and the power that is now in the hands of corporates and governments?
Another issue is that with many institutional investors focused on building a sustainable, renewable and a more equal world, can AI be used to achieve such an aim, or will it cause job losses and emit more harmful gases into the atmosphere?
Show me the honey
For the Wiltshire Pension Fund, the impact of AI is largely being felt in its portfolio. “A lot of the stocks we have in our sustainable portfolio might end up being affected by [AI],” Devine says. “There is more tech in there and forward-thinking solutions stocks, so we could end up seeing more of the implications of it.”
However, at this point Devine is not sure how AI could benefit the fund’s sustainable investing process but believes that it could help in assessing data. “We have a world of climate data and it takes our analysts quite a lot of manpower to plough through that,” she adds.
So crunching the numbers could be the main benefit of using AI to ensure better sustainable investment decisions.
Savings bees from possible extinction is one such use for a system that can process huge amounts of data. Bees are crucial to our life support system, yet their numbers are falling at a time when we need to produce more food to feed growing populations.
The World Bee Project is an initiative that uses artificial intelligence to try and help bees live longer. They gather information
on their habits from sensors, microphones and cameras. That data is then analysed by an algorithm to spot any trends that could help science intervene to increase their chances of survival.
Another way to produce more food sustainably is to use the analysis AI can provide to maximise output through nurturing seeds and knowing the perfect time to harvest crops. Data could also be used to identify failing crops or spotting the early stages of a drought.
Devine highlights the role tractor-maker John Deere is playing here. The company is using AI to reduce the use of the pesticides that are harming soil. It is using drones to identify weeds so farmers can then specifically target them with pesticides. “That is an environmentally progressive development that it has made as a company,” she adds.
The machine will see you now
The research side of medicine is one area that will benefit from AI, without scores of jobs being made redundant.
It could, for example, research a disease to predict its development and therefore allow doctors to diagnose it earlier. Back in 2021, a team of Mount Sinai medical researchers created an algorithm that predicts the development of diseases, including cancer. The team reported a 94% success rate.
Then there is making life easier for people living with disabilities. Huawei, the multi-national Chinese tech giant, used AI to create StorySign, an app that translates text into sign language to help deaf children learn.
The company also created Track AI, a device that can identify visual disorders in children in the hope of being able to treat problems to avoid sight loss. Again, AI is being used to help diagnose medical conditions earlier to help prevent long-term conditions.
More time to play?
One of the outcomes of AI is automation. It started with barriers in car parks, coffee vending machines, factory production lines and ATMs, but thanks to AI automation is rapidly spreading to other industries. Education is one such example, where students are learning more online, even in the classroom, where the system can answer their questions and mark their work.
Jobs in finance, the clerical side of the legal profession, coding, graphic design, administration and problem solving in engineering are also at risk of disappearing.
Indeed, more than 300 million full-time jobs around the world are at risk from AI, according to Goldman Sachs. A report published by the investment bank on the issue concluded that some two-thirds of jobs around the world are exposed to automation, while AI could take over a quarter of all tasks in the workplace.
So more AI leads to greater automation, which points to fewer jobs in the economy as people are replaced by machines. Unless new jobs are created and retraining is provided, then inequality in society is only likely to grow.
Christopher Moore, an investment team lead at the Wiltshire Pension Fund, says people are not quite sure what impact AI is going to have in some sectors yet. “But the likely expectation is job losses or job changes,” he adds.
For Devine, this highlights the need for stakeholder engagement when it comes to AI. “It is a theme that needs to be looked at, particularly from the social aspect of people losing their jobs or not being retrained.”
But one person was not worried about the impact of growing automation. Arthur C Clarke said that he did not fear automation because “the goal of the future is full unemployment, so we can play”. But he was an anti-capitalist, so perhaps he gave little thought to who is paying for billions of people around the world to “play” instead of finding a way to pay the rent.
But there are not just social side effects of the rise of AI to consider. One of the winners of the AI boom is expected to be data centres. More computer algorithms mean a greater number of data centres having to supply more power to support them, which means creating a larger carbon footprint.
Research carried out by a team at Cornell University looked at the environmental impact of machine learning and found that the process can emit more than 50 tonnes of carbon dioxide, which is 25% more than a typical car driving on the highways and roads of the United States.
A brave new world?
Don’t worry. Artificial intelligence may not turn us into slaves or kill us after deciding that we are a threat to the world. We have to put our confidence in the designers that they are factoring security measures into their systems to avoid such outcomes.
But AI will make our lives almost unrecognisable in the next 10 years. Working practices will change and some jobs will disappear, while others may be created.
There are bigger concerns. Will these algorithms help the world transition to cleaner sources of energy, produce more food more sustainably and create a more equality in society? Well, it will certainly benefit medical science and help investors digest reams of data faster, which could improve outcomes.
But as more algorithms are created, there will be a greater need for power to fuel them. This will only increase the level of carbon being expelled into the atmosphere, while the social challenges of more jobs being eradicated than created will lead to the gap between those who have and those who don’t growing wider.
So many of the world’s citizens may not be so happy just playing all day, as Mr Clarke was hoping he would end his days.
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