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Impact of AI on banking jobs: Industry’s reaction to ex-Barclays boss’ comments

An ex-Barclays chief executive last week claimed that AI will halve the number of jobs in the banking sector, but plenty of other industry voices have differing opinions concerning how the technology will affect financial services

The impact of AI on banking jobs is a hotly-disputed topic that has been intensified after an ex-Barclays chief executive suggested the emerging technology will halve employment in the sector.

Antony Jenkins’ comments have received both support and opposition from many prominent figures, some of whom feel artificial intelligence (AI) is a threat to job security, and some who see it as an opportunity.

“We’ve already seen something like 25% [of banking branches] close between 2011 and 2015,” he told the BBC.

“My expectation is at least another 50% of branches will close over the next five to ten years.

“Similarly, I think we’ll see something like a 50% or even greater reduction in the people employed in the industry.

“Given the scale of jobs lost is likely to be at least as large as the [previous] three industrial revolutions, we’ll need even greater numbers of new jobs to be created in the future if we are not to suffer this longer term feature called technological unemployment.”

As Mr Jenkins’ viewpoint has sparked widespread debate, here’s how other members of both the banking sector and those working on AI have reacted.

ai on banking
Antony Jenkins, ex-Barclays chief executive and CEO of 10x Future Technologies (Credit: Flickr/Chatham House)

Impact of AI on banking jobs: Bank tellers most at risk

Ian Bradbury, CTO of financial services at IT products and service provider Fujitsu UK & Ireland, acknowledged that financial services is undergoing significant change as a direct result of emerging technologies.

His company asked both the public and businesses which jobs within the sector are most likely not to exist in their current form, with bank tellers being the most frequent answer.

Mr Bradbury told Compelo: “One of the technologies said to disrupt the sector increasingly is AI, and in fact we found that seven in 10 financial sector leaders believe technology such as AI will enable them to overcome many of the socioeconomic issues they are facing today.

“The use of AI in financial services is nothing new. Trading businesses have used algorithms for many years, but what is new is the widening range of applications to which AI is being used for.

“The technology will not only replace existing manual processes, it will create new ways of doing things, which will add new value for businesses and their customers.”

Mr Bradbury pointed out that more people will need to be employed to develop AI-based automation solutions, arguing that 80% of the jobs that will exist in the next decade have not yet been invented.

“It is the responsibility of us as a nation – from banks, government, to the companies creating these new technologies – to ensure that we are equipping people with the right skills to manage this digital transformation that both the banking sector, as well as many others, are currently and will be going through for the foreseeable future,” he added.

 

Impact of AI on banking jobs: Humans will move up the value chain

The global head of AI and automation at management consulting firm Infosys Consulting argued that new technologies will enhance the role of humans, rather than diminish it.

John Gikopoulos, also a partner at the company, suggested that, as automation and AI take care of more mundane tasks, employees will be able to work on more demanding tasks.

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He said: “Many organisations are already delegating repetitive tasks to machines, while introducing new roles for humans that focus on creativity and communication.

“The next step is using AI as an opportunity for humans to move up the value chain and be rid of mundane jobs altogether.

“To combat the threat posed by automation, business leaders need to do more.

“It’s not enough just to understand the different technologies on the table – they should also understand what tech can do for their business, their customers and, crucially, their employees.

Mr Gikopoulos feels a shift in workplace culture is just as critical to the ongoing implementation of AI and automation in financial services as the acquisition of new skills.

While some focus on technical skills like coding and data analysis, he reasons that softer skills such as problem-solving and critical thinking will be the more important attributes for employees to possess going forward.

“AI can find facts and can even recommend prescriptive or proscriptive actions – but what it can’t do is formulate a watertight strategy based on the insights it discovers,” he said.

“We want business leaders to foster an atmosphere of experimentation and innovation, and constantly question how they can deploy smart technologies such as AI to solve today’s challenges.

“One thing is clear: the key to working alongside AI is doing so for the greater good of everyone – without threatening livelihoods.”

 

Impact of AI on banking jobs: AI will always have to be governed by human judgement

John Everhard, director at US software company Pegasystems, concurred with Mr Gikopoulos in believing AI will augment human jobs rather than replace them.

He argued the effect of AI on banking jobs will be positive, ridding employees of low-value work as businesses look to AI and automation to reduce costs and speed up processes.

Mr Everhard said: “Employees will be freed up to focus on adding greater value and delivering better, more authentic services.

“For enterprise software, AI will always have to be governed by human judgement.

His company, which actively works with AI and automation software, recently conducted a survey that found senior managers expect advanced analytics and robotic processes will augment their human workforces in the coming years.

Almost 70% of respondents said they expect the term “workforce” to encompass both human employees and intelligent machines.

“It is also important that we protect tasks that rely on human interaction,” said Mr Everhard.

He alluded to the fact that while AI can be of benefit to some areas of a business, it won’t be appropriate for all of it, meaning the role of humans will remain key.

He added: “We’ve done research that shows even tech-savvy millennials have a strong bias for wanting to interact with actual people.

“For example, when asked to rank their preferences when selecting and buying insurance, the ability to speak to somebody either in person or on the telephone when interacting with an insurer achieved the second highest ranking preference (42%).”