The recent hearing of the AI task force, House Financial Services Committee, alongside academics and financial services professionals, described how various emerging technologies, including AI, are being used in trading, market surveillance, robo-advisory, and many other areas of investment and financial services. During the hearing, it was concluded that the financial services industry is adopting AI at a certain pace. And the current employees who aren’t being trained to work with algorithms run the risk of losing their jobs.
Rep. Bill Foster (D., Ill.), Chairman of AI task force, during the hearing, referred to a report provided by the Wells Fargo and amp; Co. that predicts about 200,000 banking jobs in the US will be lost over the next decade due to introduction of new-age technologies, which will include AI. The hearing focused on how to make AI and humans work better together in the financial industry and how more meaningful jobs are set to be created.
Machine learning has been one prominent technology that is leading the development of new tools, changing the investment strategies with the assistance of new algorithms. For financial employees to work with such a new technology, they need to have an urgent retraining for the workers. There are over 6 million people currently employed in the finance and insurance industry. And post the adoption AI, many of them soon would be replaced because they aren’t being trained to work along with ML algorithms.
The financial sector will deploy humans to more rational roles for better decision making, while they will be replaced for the more repetitive kind to tasks that now can be accomplished by using the algorithm. The financial sector is dealing with increased consumer focus on fintechs that ease the gap between banking services and consumers. With a market capitalization of new technology and industry experts in finance, we are bound to find new domains to explore in fintech.