The ANBOUND 2024 Spring Workshop on AI Policy of Skills and Labor Markets was held on May 24, 2024. This half-day session addressed the global impacts of artificial intelligence (AI) on education and labor markets. It also explored strategies for enhancing green skills and workforce sustainability, as well as supportive AI policies and digital regulations.
The workshop was co-chaired by Ms. Yi Wang, Head of the Global Development Program at ANBOUND, and Mr. Robert Herzner, Chief Representative of Germany Trade & Invest (GTAI) at Hong Kong.
We also invited Dr. Gautam Pandey, Head of Economic, Trade & Commerce from the Embassy of India in China, Ms. Du Fang, Head of the Investment Division of Two Zones and Administrative Committee of Beijing Economic-Technological Development Area (BDA), and Ms. Jingning Nie, Business Development Manager, London-headquartered CEIC Data (an ISI Emerging Markets Group Company), as honorable guests to the event. Mr. Takahiro Sekido, Japan Practice Advisor for ANBOUND and a former Bank of Japan (BoJ) official, joined us online in Tokyo. Other participants at ANBOUND included Mr. Zhaoxi Wang, Public Relations Director, Ms. Chen Li, Economic Research Fellow, Mr. Zhou Chao and Zhijiang Zhao, both as Research Fellow for Geopolitical Strategy programme, as well as Xia Ri, Industry Researcher at ANBOUND.
Firstly, Yi Wang pointed out in her speech that technological innovation is moving too fast. New technologies and popular mobile apps have significantly transformed social structures and the concept of professions. As a result, the nature of work is continuously evolving. AI has made skill enhancement a critical issue affecting job seekers and national income. She added that skills serve as a universal language for workers, linking labor mobility and digital work across borders, which drives economic development, international cooperation, and technological advancements.
Meanwhile, AI also creates new challenges, causing public dissatisfaction and anxiety in Deepfake and the proliferation of false information on the Internet. Semiconductor chips and data centers, infrastructure that AI relies on, are also a process that consumes a lot of resources, whether in production or large-scale model training. High-end industries consume higher volumes of water and electricity, which is a thorny policy issue that all countries cannot shy away from their responsibilities, according to Ms. Wang.
She emphasized that if technological progress fails to lead to human happiness, then something is fundamentally wrong. AI does not just boast a success story in cutting-edge technology, or claim its unique superiority. She concluded that addressing these issues through interdisciplinary discussions can contribute to broader sustainability efforts.
Robert Herzner noted that AI policies significantly impact the labor market and employees' rights. AI technologies have the potential to enhance productivity, but also may pose challenges in terms of job displacement. The newly finalized European AI Act emphasizes the importance of human oversight in AI systems.
Mr. Herzner was of the opinion that China still has potential to catch up with other countries when it comes to optimizing its agricultural industry. Artificial intelligence can play a crucial role in this change by increasing the efficiency and productivity of the sector.
From the perspective of a financial practitioner, Takahiro Sekido elaborated that the impact of globalization and AI has become evident in the Tokyo market. Notable developments include cross-border transactions between Japan and China, the Kishida administration's efforts to attract global investment funds, and strengthened alliances between Japanese and U.S. financial groups.
Looking forward, global financial trading will need to pursue economies of scale more than ever before, and AI will streamline and standardize skills and labor markets on a cross-border basis. He believes that the parts of the market that have traditionally been handled by humans will become even more common across borders. However, each country has its own regulations, rules, and market practices. Therefore, the need for core personnel who can respond to the unique skills, regulations, and market practices in each country's market is expected to increase further.
Mr. Sekido observes that the Asian financial markets are becoming more interdependent than ever before, involving trading participants in Japan, China, Europe, and the United States. AI technology is becoming increasingly important, resulting in more flexible labor markets.
Generation Z will be the cohort most driving the development of AI.
Ms. Chen Li, echoed to the young voices. She remarked that China's large market provides fertile ground for AI technology adoption, but upskilling is a challenge. China shows its advantage in application, but lacks in fundamental research. Currently, the Chinese education system heavily focuses on memorization over creativity and critical thinking. AI increases productivity and reduces costs, leading to economic growth and job creation. However, it also optimizes tasks, reducing the demand for certain jobs. This can create a lag in forming a robust economic job cycle. As AI excels in repetitive tasks, the Chinese labor market with a huge population is vulnerable to AI's impact. It is crucial for the government and organizations to invest in upskilling and reskilling programs. This will prepare the workforce for future jobs and mitigate the effects of technological displacement. Additionally, the policymakers will need to make more efforts to bolster the social safety net, which guarantees those who is unable to keep up with tech revolutions.
Following this, Ms. Jingning Nie gave a presentation on CEIC, which provides essential data and tools for the global economists, investors as well as policymakers, enabling accurate analysis and forecasting. With a daily influx of information, it is challenging for economists and researchers to process and adapt this data for reliable results and forecasts. Trusted data is vital for developing contemporary models and market forecasts, assisting leadership in making informed investment. CEIC Data company also increases use of AI technology to meet with new needs from its customers.
Which countries would benefit the most from the development of AI?
Mr. Zhao Zhijiang expressed his opinion that the stages of acceptance of AI technology progress from fear to apprehension, curiosity, tolerance, and finally satisfaction as individuals understand its integration into daily life and work activities. Different countries benefit from AI technology in various sectors, such as manufacturing in Germany, daily life applications like driverless automobiles in China, and defense industry in the U.S. Eventually, the whole of global sectors everywhere will benefit from AI advancements. The U.S. and China, currently, are being identified as the primary beneficiaries in different domains.
Mr. Zhou Chao argued that the country that will benefit most from AI is the United States. Key factors for AI success are data, energy supply, and highly skilled specialists, all of which the U.S. possesses. Its free market attracts top talents worldwide. In contrast, European countries, such as Germany and France, are being short of data richness necessary for large-scale AI models. While China contains a large data pool, it must address a lot of regulatory issues. He also mentioned that implementing AI legislation in the EU is challenging due to different member states. In the U.S., state-level AI regulations have recently been completed, with Wisconsin or Kansas as examples. Major AI companies argue that excessive regulations could hinder future development in the U.S. and potentially be detrimental compared to China's AI advancements. To this end, he questioned that the EU's AI legislation would affect future competitiveness.
When it comes to the challenges faced by this technological district, Ms. Wang indicated that the inflation is pressing on new graduates who enter the fields related to AI. Tech companies tend to hire younger employees, but it is crucial to care their daily living, entertainment and social interactions in this district. Ms. Du responded that the BDA officials have recognized this importance for the youth, making policies that could benefit all residents in the E-Town, endeavoring to build a balanced and supportive environment.
Ms. Nie added that the countries able to swiftly adapt and leverage AI technology will likely gain an early advantage. AI functions as a tool, akin to an intern, capable of executing tasks with guidance. Just as one directs an intern, AI requires instructions to perform effectively. Introducing AI into the workforce can significantly enhance productivity and competitiveness, particularly in the financial industry.
Mr. Sekido closed the morning session by lastly commenting on AI innovation with human and the market. He said that AI can analyze markets using linear functions, while we still need human to understand the broader implications and stresses of the non-linear market.
The workshop discussed that challenges remain, particularly in regulatory implementation and talent development. Ultimately, the successful integration of AI into various sectors would lead to global benefits, enhancing productivity and competitiveness.
In the afternoon, the guests also visited the Beijing High-level Automated Driving Demonstration Area, and IAT AUTO, the first listed independent automobile designer in China.
The BDA (also called as E-Town), a major national-level economic development zone in China, is located in the southeastern city of Beijing, where is concentrated with high-tech research centers and joint ventures. The BDA specializes in four industrial domains: new-generation information technology, high-end and new energy vehicles, biotechnology and health, and intelligent manufacturing and robotics. The District Government plans the future integrating these sectors with digital skills, the real economy, service industries, manufacturing, science, and culture. The BDA aims to promote high-level opening up to the world, to deepen international cooperation and exchanges, and continuously enhance its international influence.
