The AI ​​wave is sweeping the banking industry: 200,000 jobs are expected to be laid off in the next three to five years

With the continuous advancement of artificial intelligence technology, the global banking industry is facing unprecedented challenges. According to a recently released report, the banking industry is expected to shed as many as 200,000 jobs over the next three to five years. Behind this number, it reflects the trend of artificial intelligence gradually replacing traditional manual positions.

The report shows that the chief information officers and technology officers interviewed generally believe that with the introduction of artificial intelligence, banks’ operating models will undergo major changes. The survey mentioned that back-office and middle-office functions have been hardest hit, especially those involving routine and repetitive tasks. Surveys show that the average net layoff rate is expected to be 3%. Nearly a quarter of the 93 respondents believe layoffs could range from 5% to 10%.

The author of the report, BI senior analyst Tomasz Noetzel, said that as intelligent robots gradually take over customer management functions, the way customer services are served will change, which means that customer-facing work will face huge challenges. Although AI will not completely replace these jobs, it will lead to the transformation of the workforce and enable employees to adapt to the new technology work environment.

In this context, the report also points out that artificial intelligence will bring far-reaching changes to the banking industry and help the industry improve profitability. It is expected that by 2027, banks' pre-tax net profits will be 12% to 17% higher than the scenario without the introduction of artificial intelligence, and total profits may increase by as much as $180 billion. In addition, about 80% of respondents believe that generative artificial intelligence will drive productivity and revenue to increase by at least 5% in the next three to five years.

Under such a trend, the working environment and functional structure of the banking industry will face major adjustments. Major banks, such as Citigroup, JPMorgan Chase and Goldman Sachs, have been aware of this change and have begun to actively plan response strategies.