Artificial intelligence will reverse the downward trend in productivity gains
Brussels – From a survey by ING Belgium1 shows that 42% of Belgians think that artificial intelligence (AI) will lead to job losses, but only 3% fear for their own job. According to the economic research department of ING Belgium, 3.3 million Belgians have a job that will be impacted by AI. However, a significant increase in unemployment in Belgium is unlikely, given the current shortage of workers and the aging population. When it comes to economic growth, Belgians are quite optimistic. Nearly a third of the population expects a positive impact on the country’s growth in the next five years. However, according to Charlotte de Montpellier, Senior Economist at ING, we still have to wait a few years before productivity growth really becomes tangible in Belgium. The increase in the annual productivity growth of employees, taking into account other (negative) effects on productivity, should be between 0.1 and 0.5 percentage points in the future.
The rise of artificial intelligence has been the topic of conversation in recent months. Technology gives rise to both fear, especially regarding the impact on the labor market, and hope, especially regarding the expected productivity gains.
Belgians remain divided about AI
The Belgians do not yet know what to expect from the rise of AI. The division with which the subject of artificial intelligence is viewed is perhaps best reflected in the fact that, according to our survey among the Belgian population, the statements “AI is a danger to society” and “AI is an opportunity for society “both could count on a lot of approval”Charlotte de Montpellier, senior economist at ING Belgium
Yet 51% of Belgians believe that products and services using AI will radically change their daily lives in the next five years.
42% of Belgians expect that the widespread use of AI will cost more jobs than it will create
When asked about their expectations about the impact of AI on the labor market, Belgians are rather pessimistic. 42% of Belgians expect that the widespread use of AI will cost more jobs than it will create over the next five years. This applies to all age groups, all genders and all professions. But when it comes to their own jobs, respondents don’t seem to worry too much. Only 3% of working Belgians expect their job to be replaced by AI in the next five years, with the lowest figures for managers and professionals. A third of them do not expect their work to be affected in any way.
AI will not lead to a significant increase in unemployment
ING’s economics department believes that AI has the potential to revolutionize the labor market, impacting workers of all skill levels across a wide variety of companies and sectors. Applying the IMF methodology to Belgium, Charlotte de Montpellier estimates that 65% of Belgian workers have a job with high exposure to AI, which amounts to 3.3 million Belgians, meaning they will be impacted by AI . 31% of jobs (1.6 million Belgians) belong to high-exposure, high-complementarity occupations, which are likely to benefit from AI, and 34% (1.7 million Belgians) to high-exposure and high-complementary occupations low complementarity, where AI is more likely to take over human tasks. These figures therefore do not mean that this percentage of employees will lose their jobs. About 34% of Belgian employees are unlikely to be affected by AI.
Administrative workers, who mainly fall into the “high exposure and low complementarity” category, are likely to be most affected by AI and this category is likely to see job losses. Conversely, managers are highly exposed to AI, but are more complementary to the technology and therefore more likely to benefit from it.
Implementation processes rarely happen overnight, so the transformation of jobs will be gradual. At the same time, demand will continue to evolve and new needs and new professions are likely to emerge. We must also take into account changes in labor supply. With an aging population, AI will not lead to a significant increase in unemployment in BelgiumCharlotte de Montpellier
31% of Belgians expect a positive impact on Belgian growth
More than 31% of Belgians expect a positive impact on Belgian growth in the next five years, while 18% predict a negative impact.
For AI to have an impact on economic growth at a macroeconomic level, it must have an impact on productivity. It must be said that despite the increasing use of AI, productivity growth in many countries, including Belgium, has been relatively slow in recent years. However, the current lack of a significant impact of AI on national productivity figures does not mean that there will be no impact at all. In fact, it is simply too early to see the impact reflected in the macroeconomic figures.
The economics literature has shown that the invention of general-purpose technologies, such as electricity and the personal computer, initially led to a decline in productivity because they required changes in production methods and business organization, as well as investments in human capital. Historically, a productivity boost is usually preceded by an increase in investment in the equipment needed to use the new technology for 2 to 3 years. Ultimately, we think we will have to wait a few more years before productivity growth really becomes visible in the macroeconomic dataCharlotte de Montpellier
ING’s economic research department estimates that the productivity gains generated by AI at the macroeconomic level will be significant, but that the amplifying effect will be weaker than estimated by some. Productivity gains from AI could ultimately amount to a maximum of 1 percentage point annually worldwide, an impact equal to that of the invention of the PC and the Internet. However, this does not mean that productivity growth will actually increase by almost 1 percentage point. While AI can be a source of productivity gains, other factors, especially the aging of the population and the decline in productivity gains from previous innovations, will weigh on productivity growth.
All things considered, we expect annual productivity growth, and thus the potential growth of the economy, to increase slightly in the coming years, by about 0.1 to 0.5 percentage points. Productivity gains in Europe and Belgium are likely to be at the lower end of this range, while those in the United States are likely to be at the higher endCharlotte de Montpellier
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End of press release
For more information:
Press service – Renaud Dechamps: [email protected]
+32 497 47 16 04
Economic Research Service – Charlotte de Montpellier, senior economist: [email protected]
+32 473 63 49 28
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1 Survey conducted by Ipsos, at the request of ING, in December 2023 among a representative sample of 1,000 Belgians. The same study was also conducted in Germany, Spain, the Netherlands, Poland, Romania and Turkey.
