According to a media report published on Thursday (January 9), global banks are expected to cut up to 0.2 million jobs in the next three to five years as AI gradually encroaches on tasks currently handled by humans.

The report shows that the Chief Information Officers and Chief Technology Officers of the banks surveyed anticipate an average reduction of 3% in their workforce. The Analysts who wrote the report indicate that the risk of layoffs in back office positions, middle office positions, and operation departments is likely the greatest.

The front, middle, and back office is a very popular concept in the banking system, which can be understood as follows: the front office is directly facing customers and is responsible for marketing and service work, such as counter staff, lobby managers, and customer managers.

The middle office provides professional management and guidance for the front office, including risk management, product development, etc. The back office primarily handles administrative and operational work, such as accounting, human resources, and IT support.

As robots begin managing customers, customer service may change, and roles will be at risk. Analysts state, 'Any job involving repetitive tasks is at risk. But AI will not completely eliminate them; rather, it will lead to a transformation of the workforce.'

Among the 93 respondents, nearly a quarter (24%) expect total employee numbers to decline significantly by 5% to 10%; 17% of respondents believe it will exceed 10%; 19% expect a decrease of 0% to 5%; and 16% expect to maintain current job levels.

Citi's report from last June stated that the likelihood of AI replacing jobs in the banking sector is greater than in any other industry. At that time, Citi indicated that about 54% of jobs in the banking sector are likely to be automated.

Despite this, many companies emphasize that this transition will only change jobs and not completely replace them. Two months ago, Teresa Heitsenrether, who is responsible for AI work at JPMorgan, stated that the generative AI adopted by the bank so far is increasing job opportunities.

In addition to layoffs, the survey results also indicate that the industry will undergo profound changes, with profitability likely to increase: by 2027, as AI boosts productivity, the Banks' pre-tax profits could be 12% to 17% higher than before, with total profits increasing by $180 billion.

Eighty percent of respondents also expect that in the next three to five years, generative AI will improve productivity and revenue generation capability by at least 5%.

JPMorgan CEO Jamie Dimon stated in 2023 that even though AI will replace some jobs, it is likely to greatly improve the quality of life for employees.

Dimon stated at that time: "Due to technological advancements, your children will live to be 100 years old without getting cancer. Moreover, they may only need to work three and a half days a week."

Editor/lambor