– Unfounded fears: Despite fears of widespread job losses, the major documented impact of automation has actually been a decline in worker hours coupled with higher living standards
– Big money: First quarter of ’17 has marked highest ever number of artificial intelligence funding deals, with AI set to become one of hottest trends since “big data” investments
– Long way to go: Point at which economic growth will accelerate because of the rapid growth in intelligent machines’ productivity is estimated around 100 years, economist says
HOUSTON — Computer scientists are predicting the arrival of a machine that rivals the human brain within 20 years, and investment in artificial intelligence is now at an all-time high. So should we expect machines to soon replace humans and large-scale job displacements? In a word, no, BBVA Compass economists say in a new report.
In the report, “When Robots Do It All and Leisure Is Mandatory: Not for Another 100 Years,” BBVA Compass Economist Shushanik Papanyanexplores the historical parallels between the present day and the 1950s and 1960s, when fear that new technologies would displace workers also ran high. She concludes that, then as now, the fears are unfounded.
“The fear of technological unemployment has not materialized in the past and likely will not in the foreseeable future because the jobs lost to automation will be matched by the new jobs created by the growth-boosting effect of technological advancement,” she concludes.
Among Papanyan’s other conclusions:
- Not impossible, but not anytime soon: While it’s possible that economic growth will accelerate due to rapid growth in the productivity of intelligent machines, the prospect is far off. The economist’s extrapolation of estimated trends suggests that the time at which it could be reached is in 100 years or more.
- The money trail: In 2015, venture capital investments in robotics more than doubled their 2014 amount, and there have been seven quarters of at least $500 million. In fact, the first quarter of 2017 has marked the highest number of AI funding deals. The global robot market investments are estimated to grow to $188 billion by 2020.
- 40-hour work week the first relic? The major documented impact of automation on labor has been the decline in worker hours coupled with growth in living standards. Taking advantage of automation may slowly lower the standard 40hour work week, she writes.
To read the full report, go to bbva.info/2uJeZTB.
Led by Nathaniel Karp, the bank’s research team analyzes the U.S. economy and Federal Reserve monetary policy. For its analyses, the economists create models and forecasts for growth, inflation, monetary policy and industries. The Economic Research team also follows a variety of issues that affect the Sunbelt states where BBVA Compass operates. Follow their work on Twitter @BBVAResearchUSA and @BBVACompassNews.
To learn more about BBVA Compass, visit: www.bbvacompass.com
About BBVA Group
BBVA is a customer-centric global financial services group founded in 1857. The Group is the largest financial institution in Spain and Mexico and it has leading franchises in South America and the Sunbelt Region of the United States; and it is also the leading shareholder in Garanti, Turkey’sbiggest bank for market capitalization. Its diversified business is focused on high-growth markets and it relies on technology as a key sustainable competitive advantage. Corporate responsibility is at the core of its business model. BBVA fosters financial education and inclusion, and supports scientific research and culture. It operates with the highest integrity, a long-term vision and applies the best practices. More information about BBVA Group can be found at bbva.com.
About BBVA Compass
BBVA Compass is a Sunbelt-based financial institution that operates 657 branches, including 342 in Texas, 89 in Alabama, 63 in Arizona, 61 in California, 45 in Florida, 38 in Colorado and 19 in New Mexico. BBVA Compass ranks among the top 25 largest U.S. commercial banks based on deposit market share and ranks among the largest banks in Alabama (2nd), Texas (4th) and Arizona (5th). BBVA Compass has been recognized as one of the leading small business lenders by the Small Business Administration (SBA) and ranked 5th nationally in the total number of SBA loans originated in fiscal year 2016. Additional information about BBVA Compass can be found at www.bbvacompass.com. For more BBVA Compass news, follow @BBVACompassNews on Twitter or visit newsroom.bbvacompass.com.
Any statement or opinion of a BBVA Compass economist is that economist’s own statement or opinion and does not represent a statement or prediction by BBVA Compass, its parent companies or management.
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SOURCE BBVA Compass