How Will AI Affect The Financial Job Market?
Technology has brought so many possibilities, especially in the business and finance market. For instance, if you have a business for sale today, you do not have to wait for ages for a potential customer to bump into your ad on the magazines – which they rarely get time to read.
Today, you have the option of promoting your business and making acquisitions faster thanks to the information put up on digital platforms.
Artificial intelligence is one of the emerging technologies that has proven to do a very significant job in changing the way things are done in industries. The focus today will, however, be directed to the financial job market.
How will AI affect the financial job market?
1. New opportunities and challenges
Artificial Intelligence will bring new challenges and opportunities in the financial job market. The perks arise from the fact that AI will increase the automation of processes and make things faster, decision making will be more effective and efficient, and intelligence analysis will also be supported. With that, there will emerge new business models.
The downside, however, involves market instability, concentration, loopholes, and technology. Market instability and turmoil arise whereby all the market participants apply machine learning techniques to outperform others. More so, it makes B2B finance and the financial job market vulnerable to manipulation by cybercriminals. AI will also interfere with consumer privacy and hinder regulation.
2. The rebuilding of the financial industry value chain
As AI continues to penetrate the financial job market, the value chain of the financial job market will continue to increase. This is through automation of processes and activities and intelligent analysis. With that, many changes will be seen in the banking sector, capital markets, and insurance.
3. Job cuts and improved efficiency
Job cuts refer to the reduction of the amount of work that an organization is expected to handle. This is thanks to automation. As a result, organizations will have more time allocated to more productive activities in the workplace. AI will also help in cutting costs in the financial job markets by eliminating posts that are not needed. Also, efficiency is based on the fact that the technologies will be used in decision-making processes and intelligence analysis.
However, you need to note that AI will not necessarily take away jobs. It also could be a source of job creation in the financial job market. Among the future posts that will be created in the financial job market are data detectives, AI business development managers, IT facilitators and chief trust officers to mention a few. On that note, Boston Consulting Group estimates that by 2027, AI will have either increased job cuts or lead to an increase in new positions by 23 percent.
4. Change in employment structure
The infiltration of Artificial Intelligence in the financial job market will cause a change in the employment structure in these markets. That is, especially in light of the skill requirement. This will, in turn, shift the demand for manual skill and focus more on talent pertaining to computer technology. There will arise in demand for complex problem-solving skills, emotional communication, and creativity.
5. Better performance in the financial job markets
The financial job markets will see a significant improvement in the overall performance. As aforementioned. AI banks on automation of processes, efficiency and decision making. As it is applied in the market, you are bound to see faster and better operations, better decisions in the various activities in the job market and innovation. The need for specialized skills will see the improvement of firms in the financial job market as the workforce look to better their skills by seeking more training to meet the new market demand.
6. Prevention of fraud and reduction of risk
AI will see a decrease in fraudulent activities in the financial job market that threaten to put investors’ assets at risk. Through data analysis, it will be easy for organizations to identify potential risks in real time and act on them in good time. Through the use of machine learning algorithms, players in the financial job market will be able to make quicker, more flexible and transparent credit decisions and as a result, reduce risk and malpractices.
7. Marketing and sales
Insurance companies are more likely to benefit from this. This is through loss prediction. Thanks to AI, insurance companies will be able to predict customer churning through data modeling. By integrating both internal and external data sources and backing them by the various analysis algorithms, the firms will be in better positions to make accurate predictions on churn rate and boost their sales.
As much as AI has its own set of disadvantages, the perks outweigh them. The financial job market has much more to gain through AI than to lose.
How will AI affect the financial job market?
- Opportunities & challenges
- Value chain
- Improved efficiency
- Employment structure
- Performance in the workplace
- Fraud reduction/prevention
- Marketing & sales