There will be winners and losers from AI – but we must embrace it, not shun it
AI will benefit some people and their jobs while replacing others – like all historic innovations. But if regulated safely, it will prove ground-breaking in many areas, including education, writes Guy Hands
It was October 1986 when the London stock market switched to electronic trading. I was working at Goldman Sachs at the time. Most of us younger traders had been eagerly awaiting the dawn of the new era, but not everyone was keen to see things change. This divide created by technology between the old and the new has similarities to the lines that AI is drawing up now.
Back in Canada in the 1980s, it was the value and structural traders like myself who were most excited about electronic trading. We welcomed it like a new best friend. It took care of much of the “grunt work”: no more 6am starts to spend two hours calculating yields of over 100 bonds on a calculator that had to be written down, photocopied and distributed to the sales force. The new technology gave us more time to think laterally and seek out the deals that were left field but would yield great returns.
Many traders at the time knew the price of everything in their universe but the value of nothing. When electronic trading came into play, some of these traders who were previously earning over a million pounds a year were replaced within two years by graduates on £85,000.
Some institutions in the City also resisted the transition to electronic trading and suffered because of it. British merchant banks in particular didn’t want to embrace the new technology. They thought they could compete with the American investment banks by continuing to have long alcohol-fuelled lunches, complete with cigars and public school jokes. Needless to say we were not impressed and the bank died just a few years later.
In short, although the finance industry grew enormously during that period and London came into its own as a world centre for international finance, not everyone survived the change to reap the rewards.
AI will not just affect finance; every area of intellectual activity will be transformed. Every business has the opportunity to benefit or be left behind. While some people will see their salaries multiply, there will also be cuts in income where jobs can be streamlined by AI.
Rather than resisting this change, we need to adapt to our new reality. The UK should move quickly to be part of this transition by redesigning the education system and developing an effective regulatory framework.
Education will play a dramatic role in deciding which countries succeed in the AI era. Britain’s schooling has been slow to move away from Victorian ideals of rote learning, which doesn’t encourage creative or independent thinking. However, just as Google levelled the playing field for general knowledge, today AI helps everyone write decent essays, regardless of our lack of memory of grammatical rules. There is an opportunity here to design a system that is more inclusive and more supportive of the world that the younger generation will grow up to inherit.
There are already apps which have infiltrated the education system and expensive private schools will be forced to prove their worth as these apps develop over time as free or very minimal costing resources. Using AI in education could be a once in a generation opportunity for the UK to develop a world-class education system fit for the future, but we must move quickly.
As with education, regulation has the potential to differentiate the UK while ensuring that AI is used and developed safely and ethically. Although the UK has been relatively uncompetitive and unable to keep pace with the rate of technological change over the last 30 years, one of the few upsides of Brexit is that we have the opportunity to move faster than our competitors if we want. With Rishi Sunak currently in the United States to promote the UK as a leader in global AI governance, we have an opportunity to make a name for ourselves globally. We could carve out our place on the world stage as an attractive place for the next stage of technological innovation, but whether we can create the environment needed to succeed remains to be seen, as the EU and the US are already discussing methods of regulating AI.
There are certainly risks around AI which shouldn’t be ignored. But in the same way that medical research could unwittingly release a super virus, development cannot be held back on account of the risks. Far from it, AI is simply the next stage in our evolution as humans. It will bring challenges as well as opportunities but if used correctly it will allow us to focus on the one thing that is most important and that technology will never be able to do: be human.