Women and Low-Wage Workers Face Automation Risks in the US, McKinsey Report Finds
A recent report by McKinsey & Co. highlights the risks faced by women and low-wage workers with the increasing penetration of automation and artificial intelligence (AI) across the US economy. The report predicts that nearly one-third of work hours could be replaced by automation, impacting various industries and occupations.
The research indicates that women are 1.5 times more likely than men to need to transition to new occupations by 2030. This disparity arises due to the disproportionate representation of women in industries such as office support and customer service, which are expected to be heavily affected by automation. Moreover, Blacks and Hispanics are also likely to be adversely impacted as the demand for jobs in food and production decline.
The McKinsey Global Institute estimates that around 12 million workers in the United States will need to change their occupations in the next decade. This shift will not only be driven by automation but also by the pursuit of net-zero emissions, which will further disrupt millions of jobs.
What is concerning in this labor market transformation is that the majority of job turnover will occur among low-wage workers. According to the report, these workers are up to 14 times more likely to require occupational changes compared to those in high-wage positions. To successfully transition to new roles, many of these individuals will need to acquire additional skills.
While white-collar workers, including lawyers, teachers, financial advisers, and architects, are expected to face significant changes due to the rise of generative AI, the report suggests that most of these jobs will undergo modifications rather than be completely replaced.
The installation of generative AI, such as OpenAI’s ChatGPT, may not result in catastrophic job loss, as highlighted by Michael Chui, a partner at the McKinsey Global Institute. Nevertheless, he emphasizes that the technology will bring changes to almost every job, highlighting the need for adaptation and upskilling.
The transition towards achieving net-zero greenhouse gas emissions in the US may also affect employment. The report estimates that approximately 3.5 million positions will be eliminated in industries such as oil and gas production and automotive manufacturing. However, it anticipates that the construction of renewable energy infrastructure and increased government spending on infrastructure will generate around 700,000 new jobs, thereby offsetting the losses.
McKinsey suggests that if job reshuffling is executed correctly, the US can experience a substantial increase in productivity and prosperity. In an optimistic scenario presented by the report, annual productivity growth could rise to 3% to 4%, compared to the current 1%. However, to achieve this, the country requires workforce development on a larger scale.
In summary, the McKinsey report sheds light on the challenges faced by women and low-wage workers as automation and AI technologies transform the US labor market. To navigate this shift successfully, proactive measures such as upskilling programs and workforce development initiatives are crucial. By embracing these changes, the US can unlock its productivity potential and lay the foundation for a prosperous future.
