Over the next three years, DBS, Singapore's largest bank, has announced plans to reduce the number of employees by approximately 4,000 by way of a significant shift toward automation. A key reason for this decision was the growing adoption of artificial intelligence (AI), which will gradually replace human employees in performing functions previously performed by humans. 

Essentially, these job reductions will occur through natural attrition as projects conclude, affecting primarily temporary and contract workers. However, the bank has confirmed that this will not have any adverse effects on permanent employees. A spokesperson for DBS stated that artificial intelligence-driven advances could reduce the need for temporary and contract positions to be renewed, thereby resulting in a gradual decrease in the number of employees as project-based roles are completed. 

According to the bank's website, the bank employs approximately 8,000-9,000 temporary and contract workers and has a total workforce of around 41,000 workers. Former CEO Piyush Gupta has highlighted the bank's longstanding investment in artificial intelligence, noting that DBS has been leveraging artificial intelligence technology for over a decade. According to him, DBS has employed over 800 artificial intelligence models in 350 applications in the bank, with the expected economic impact surpassing S$1 billion by 2025 (US$745 million; £592 million). 

DBS is also changing leadership as Gupta, the current CEO of the bank, is about to step down at the end of March, and his successor, Tan Su Shan, will take over from him. Artificial intelligence is becoming increasingly widely used, which has brought about a lot of discussion about its advantages and shortcomings. According to the International Monetary Fund (IMF), artificial intelligence will influence approximately 40% of global employment by 2050, with Managing Director Kristalina Georgieva cautioning that, in most scenarios, AI could worsen economic inequality. 

According to the International Monetary Fund (IMF), AI could lead to a reduction in nearly 40% of global employment in the future. Several CEOs, including Kristalina Georgieva, have warned that, in many scenarios, artificial intelligence has the potential to significantly increase economic inequality. For this reason, concerns are being raised about its long-term social implications. The Governor of the Bank of England, Andrew Bailey, told the BBC in an interview that artificial intelligence shouldn't be viewed as a 'mass destruction' of jobs, but that human workers will adapt to evolving technologies as they become more advanced. 

Bailey acknowledged the risks associated with artificial intelligence but also noted its vast potential for innovation in a wide range of industries by highlighting its potential. It is becoming increasingly apparent that Artificial Intelligence will play a significant role in the future of employment, productivity, and economic stability. Financial institutions are evaluating the long-term effects on these factors as it grows. In addition to transforming workforce dynamics, the increasing reliance on artificial intelligence (AI) is also delivering significant financial advantages to the banking sector as a whole.

Investing in artificial intelligence could potentially increase the profits of banks by 17%, which could increase to $180 billion in combined earnings, according to Bloomberg. According to Digit News, this will increase their collective earnings by $170 billion. Aside from the substantial financial incentives, banks and corporations are actively seeking professionals with AI and data analytics skills to integrate AI into their operations.

According to the World Economic Forum's Future of Work report, technological skills, particularly those related to artificial intelligence (AI) and big data, are expected to become among the most in-demand skills within the next five years, especially as AI adoption accelerates. As an evolving labor market continues to evolve, employees are increasingly being encouraged to learn new skills to ensure job security. 

The WEF has recommended that companies invest in retraining programs that will help employees adjust to the new workplace environment; however, some organizations are reducing existing positions and recruiting AI experts to fill the gaps left by the existing positions. They are taking a more immediate approach than the WEF has recommended. AI has become increasingly prevalent across various industries, changing employment strategies as well as financial priorities as a result. 

With artificial intelligence continuing to change industries in several ways, its growing presence in the banking sector makes it clear just how transformative it has the potential to be and the challenges that come with it. It is clear that AI is advancing efficiency and financial performance of companies; however, this integration is also forcing organizations to reevaluate their workforce strategies, skill development, and ethical considerations related to job displacement and economic inequality. 

There must be a balance struck between leveraging technological advancements and ensuring a sustainable transition for employees who will be affected by automation. To prepare the workforce for the future of artificial intelligence, governments, businesses, and educational institutions must all play a critical role. A significant amount of effort must be put into reskilling initiatives, policies that support equitable workforce transitions, and an ethical AI governance framework to mitigate the risks associated with job displacement. In addition, the advancement of artificial intelligence, industry leaders, and policymakers can help promote a more inclusive and flexible labor market. 

Financial institutions continue to embrace the technology for its efficiency and economic benefits, but they must also remain conscious of its impact on society at large. For technological progress to become a significant factor in long-term economic and social stability, it will be essential to plan for the workforce early, ethically deploy ethical AI, and upskill employees.