new McKinsey research illustrates automation’s opportunities and challenges for policymakers and business Image Credit: Supplied

Dubai: An estimated 45 per cent of existing jobs in the Middle East could be automated, according to McKinsey & Company’s latest report, The Future of Jobs in the Middle East, launched today at the World Government Summit.

The potential for automation translates into massive economic value and opportunities across the region. In all six Middle Eastern countries examined, $366.6 billion (Dh1,346.3 billion) in wage income and 20.8 million full-time equivalent employees (FTEs) are associated with activities that are already technically automatable today.

“Our research encourages Middle East policymakers and business leaders to embrace the transition into the new age of automation, and invest in skills that workers of the future will require,” said Jan Peter Moore, Associate Partner at McKinsey & Company.

He pointed out that for countries such as the UAE, Bahrain and Kuwait, the projected proportion of work, and by extension workers displaced is higher than the projected global average.

“This means workers in these countries will need to evolve to adapt to global forces of workforce automation and technological progress more rapidly than other countries in the region,” he said.

As the future of work materialises, policymakers have a window of opportunity to embrace AI and automation, equip workers with the rights skills that complement new automation technology, and increase opportunities for new jobs from the implementation of technologies. They can also take advantage of technological disruption to build new competitive advantage, and reinvest AI-driven productivity gains in strategic diversification initiatives across sectors.

Automation’s potential varies substantially across industries. Sectors like manufacturing, transportation and warehousing where routine tasks are common have a high potential for automation, whereas sectors where more human interaction is required including the arts, entertainment, recreation, health care and education, have a lower potential to be automated — ranging from 29 to 37 per cent.

For the UAE, and other dual labour markets in the Gulf, organising the future workforce and addressing segmentation will be vital. In the UAE, the research estimates that based on the segmentation of work activities by sector, occupation and education, more than 93 per cent of the labour-saving technical automation potential applies to jobs currently held by expat workers. More than 60 per cent of the automation potential is concentrated in six out of the 19 sectors examined; these include other services, administrative and support, government, manufacturing, construction, and retail trade as well as wholesale trade.