The Terminator warned us killer robots were coming. What it didn’t tell us is that they would be hunting entry-level finance jobs instead of Sarah Connor.
At this point, everyone’s heard of Chat GPT and the plethora of other AI-based technologies that are popping up to threaten the jobs of seemingly everyone, except maybe your favorite bartender (unless those weirdos at Boston Dynamics come up with a scotch pouring robot). But, is it actually something to be worried about? And if so, when is the great AI takeover likely to happen?
Not All AI is the Same
Before Looking at AI’s potential impact on finance jobs, it’s worth knowing some of the main systems behind different AI’s, and how they’re being used.
Predictive AI – Simply put, predictive AI analyzes existing data to make predictions on future trends and events. This could be predicting things such as future demand, financial trends, consumer trends, or even fraud detection. Sadly, it can’t predict a 5-leg parlay.
Generative AI – Generative AI takes sets of training data, and uses what it learns to make new content. This AI is being developed in financial services to create things like pitch books, due diligence reports, and other similar content.
Are Entry-Level Positions Over?
The immediate answer, no. Not yet, at least.
Entry-level positions exist to thin out the grunt work the higher-ups don’t have time to deal with. Data collection, drafting reports, setting up calls… all things nobody really wants to do. As it stands, it might not be long before no one has to, thanks to AI. If AI can progress in the coming years at a decent rate (it’s already shown serious promise and will only get better), it wouldn’t be wild to assume that many low-level tasks could be automated, reducing the need for entry-level analysts and summer interns.
While a full AI takeover is still a sci-fi fantasy (for now), the more immediate future will still require some low-level positions to be kept on to manage anything the AI can’t perfectly handle. The good news here is that until it’s ready to replace people, AI will certainly be a beneficial tool in increasing productivity and freeing up time to be focused elsewhere. The bad news, firms might decide they need fewer people toiling away at tasks that software can do in a fraction of the time.
Where is AI Already Being Used?
As it stands, AI is filling in as a helpful tool rather than a job killer. M&A is an area where it’s already showing plenty of promise, helping boost productivity when it comes to due diligence and drafting contracts, and is in the early stages of helping out with risk analysis and even success predictions.
The benefit of AI for something like M&A is fairly obvious. No amount of summer interns or analysts are going to be able to handle the same volume of data AI can. That means fewer information gaps, more comprehensive reports, and all in record time.
AI Still Has Flaws
AI definitely has some job-stealing potential, but, fear not, for AI is not without its flaws. Due to the potential of flawed training data or biased models, human oversight is still needed to ensure accurate and reliable information is being presented.
One area in which our good old brains still have the upper hand on AI (although this seems to apply to a seemingly shrinking amount of people), is the ability to differentiate reliable sources from what some may call “fake news.” As a simplified example, while you and I know the Onion and Ballsack Sports aren’t pushing out real breaking news, AI is currently more prone to an “ate the onion” style mishap.
Beyond reliability in information differentiation, AI also currently lacks contextual understanding. That’s to say that while it can identify patterns and sift through mounds of data, it doesn’t truly understand the meaning behind it. Sure, it can tell you that GME stocks went through the roof in January 2021 (and maybe predict others that have short squeeze potential), but it can’t understand the context of a “meme stock,” or how a subreddit full of self-described “apes” created enough social sentiment to blow the whole thing sky high.
Simply put, AI doesn’t understand humans, and that’s something that gives us a leg-up for the foreseeable future.
AI is absolutely coming, and it’s a matter of when, not if, it will be capable of replacing people’s jobs. The real question will come down to how well it can actually function independently of people. While AI might be able to do entry-level work, managing the AI will still require human input for quite a while, and thus the tasks might change, but the entry-level schmuck will probably still be needed.
Cyrus Grant is a writer from Southern California with a background in marketing, dispute resolution, law, and politics. When he isn’t writing he can be found deep-diving into the latest technology trends or simply spending time at the beach.