Can Advanced Artificial Intelligence Potentially Increase the Number of Employees in Banks?
In the ever-evolving world of banking, the question on everyone's lips is whether generative AI will lead to a massive reduction in bank jobs, or if it will, in fact, create more opportunities. Recent reports suggest that up to 200,000 jobs might be cut over the next few years due to AI, but what if we're looking at this all wrong?
Back in the 80s, we were told that spreadsheets would eliminate every finance job. Then, in the early 2000s, we heard the digital revolution was going to replace bank tellers. Neither of those predictions came to pass. In fact, technology often leads to job transformations rather than eliminations.
If AI is going to do the same, we might find that it actually helps banks eliminate waste while adding value. This means the nature of the work itself will change. Already, we're seeing this happen in the financial services sector. Underwriters, for example, are dealing with an overwhelming number of applications, but AI is helping to streamline this process, allowing them to review more applications, underwrite more policies, and ultimately drive more value.
This is a prime example of taking waste out of the system. Instead of spending precious time sorting through documents, underwriters can focus on generating revenue. And as a result, the need for more underwriters might actually increase, not decrease.
We're seeing this scenario play out across various banking sectors, from commercial banks to wealth management, and it's only just beginning.
So, how should banks think differently about their talent pool in this new era of AI? Here are a few thoughts:
- The importance of AI literacy: Winning in AI isn't about having an army of PhDs; it's about equipping your entire workforce with a basic understanding of how to leverage this technology. It should be as accessible as a tool like Excel.
- Investing in your people: With over 70% of the work in banking likely to change, banks can't hire their way out of this. Instead, they should look to upskill their own talent.
- Embracing a culture of curiosity and execution: Banks need a culture that encourages collaboration, innovation, and continuous learning. They need to take a 'crawl, walk, run' approach to AI adoption, starting small and building up over time.
- Getting employees up to speed: Despite what bank executives may think, employees may not be fully prepared for AI. Banks need to invest in training programs to help bridge the gap.
According to Accenture's recent research, over two-thirds of bank employees are already using AI-based tools, and a slight majority feel they have the foundational training needed. However, there's still room for improvement.
The future of AI in banking will largely depend on how banks approach it. Do they see it as a cost-cutting measure, or do they see it as a tool to drive revenue and enhance productivity? The best banks are those that understand the real power of AI – its ability to help banks and their talent do more.
Enrichment Insights
While it's true that AI is transforming the banking landscape, it's important to approach it with a nuanced perspective. While automation may eliminate some jobs, it will also create new ones, particularly in the areas of AI development, implementation, and management.
Furthermore, the adoption of AI also presents a unique opportunity for upskilling and reskilling employees. As AI takes over routine tasks and processes, workers will need to develop new skills, such as critical thinking, problem-solving, and communication.
Moreover, banks should consider investing in data infrastructure to support the scalable storage of vast amounts of data required for AI applications. This includes factors such as data privacy, ethical considerations, and regulations – all of which require careful attention to ensure responsible AI implementation.
Ultimately, the key to success lies in adopting a comprehensive strategy that addresses these factors and continually adapts to the evolving landscape of AI in banking.
- In the realm of financial services, the integration of AI is leading to a shift in thinking about gen AI bank jobs, with a focus on enabling bank talent to leverage this technology.
- Banks are recognizing the potential of gen AI and banking jobs, viewing AI not as a threat, but as a tool to eliminate waste and add value, thus transforming the nature of bank jobs.
- The impact of AI and banks is evident in various sectors, including underwriting, where AI is streamlining processes and enabling underwriters to generate more revenue and potentially increase their numbers.
- As AI changes the landscape of banking, it's crucial for banks to foster a culture of AI literacy, investing in their employees and encouraging a spirit of curiosity and execution.
- To adapt to the changing landscape, banks should embrace a 'crawl, walk, run' approach to AI adoption, starting small and building up their AI capabilities over time.
- While some bank job cuts might occur due to AI, the generative capabilities of gen AI and banking could lead to the creation of new roles in AI development, implementation, and management.
- The future of banking largely depends on how banks approach AI – whether they view it as a cost-cutting measure or as a tool to drive revenue and enhance productivity, enabling their talent to do more.
