Will your job in finance survive the AI automation wave

Greetings!

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Will your job in finance survive the AI automation wave?

Dear friend,

I was just reading this Citigroup report about AI in banking, and I have mixed feelings about it. On one hand, it’s incredible to see the potential benefits of AI, like boosting productivity and slashing costs. On the other hand, there's this uneasy feeling about how automation could reshape jobs in the industry.

Citigroup claims that 54% of banking jobs could be automated. That’s a massive number! They also mentioned another 12% of roles could be augmented by AI. While these changes could make banks more efficient and profitable, it’s hard not to wonder about the human cost. What happens to all those employees whose jobs could be automated? Even if new roles in AI management and compliance spring up, will that balance out the jobs lost?

Jane Fraser, Citigroup’s CEO, talked about moving AI from the lab to the factory floor. It’s a catchy way to say they’re ramping up AI use, especially for tasks like scanning regulatory documents or customizing investment advice. It sounds efficient, but I can’t help but think about the potential downsides. Will clients miss the personal touch of human advisors? And how secure will these AI systems be against cyber threats?

JPMorgan Chase’s CEO, Jamie Dimon, believes AI could shrink the workweek to 3.5 days. That sounds like a dream come true for employees, but it's hard to believe it’ll be that straightforward. The transition might be rough, and I wonder if the promise of a shorter workweek is realistic or just hype to sell the benefits of AI.

Then there’s the issue of customer service. Companies like Revolut are using AI to handle a significant chunk of customer interactions. Francesca Carlesi from Revolut mentioned that AI manages over 30% of their customer chats and predicts it could rise to 80%. Sure, it’s efficient, but what about the quality of service? Can AI really understand and resolve all the nuanced issues customers face? I’m skeptical.

Citigroup’s CTO, David Griffiths, is optimistic, saying AI can revolutionize the industry and improve profitability. But this revolution isn’t just about profit; it’s about people’s livelihoods. It’s crucial to implement AI responsibly, ensuring it complements human workers rather than simply replacing them.

We can look back at history for some perspective. Citigroup pointed out that even after ATMs were introduced, the number of human tellers increased for a while. This suggests that new technology doesn’t always mean fewer jobs, but it’s hard to say if AI will follow the same pattern.

Ultimately, while AI has the potential to transform banking in remarkable ways, we need to be cautious and thoughtful about its implementation. Balancing technological advancement with the well-being of employees and customers is essential. How do we ensure that the benefits of AI in banking don’t come at too high a cost? That’s the real question we need to keep asking.

Catch up soon, and let me know what you think!

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The Menu Magic is written by Francisco Cordoba Otalora, Founder & CEO at Zote, Leveraging the power of your network to hire great talent where everyone shares in the bounty.