And How Franchising Can Help
Did I use AI to write this? Some of it? How many "blog" posts have you read lately only to wrap up an article feeling like you haven't read anything at all?
Listen, we've all used ChatGpt here and there when we need inspiration, but as a Franchise Consultant I've seen the effects of AI firsthand. People come to me quite often when they are suddenly laid off. Unfortunately, when the job market is tough and unemployment is high, I am at my busiest. Typically I see executive level folks that feel like they have accumulated enough real experience to leverage into a scalable business of their own. Recently, full departments are being eliminated and I will share my insight (backed by data) as to what is happening and what you can do about it.
Indeed a recent global PwC survey2 found that 37% of workers were worried about the possibility of losing their jobs due to automation and estimated the proportion of existing jobs that might be of high risk of automation by the 2030s. Here are some of the findings.
Automation of Routine Tasks: AI excels at automating repetitive and routine tasks. Jobs that involve data entry, simple decision-making, and manual labor are at high risk of being automated. This can lead to significant job losses in industries such as manufacturing, customer service, and administrative support .
Advanced AI in Professional Roles: AI is not limited to low-skill jobs. It is also making inroads into professions that require higher levels of education and expertise. For instance, AI-powered algorithms can analyze medical images, draft legal documents, and perform financial analysis. As AI becomes more sophisticated, roles in healthcare, law, and finance may also face significant disruption .
Shift in Skill Requirements: As AI takes over routine tasks, the demand for skills is shifting. Employers are now seeking workers with expertise in AI, machine learning, data analysis, and other tech-related fields. This shift creates a skills gap, leaving many workers unprepared for the new job landscape .
Key Industries Affected
Manufacturing- A June 2019 study from Oxford Economics, “How Robots Change the World – What Automation Really Means for Jobs and Productivity”, meanwhile, suggested that robots could take over 20 million manufacturing jobs around the world by 2030, with 14 million robots being put to work in China alone. Lay-off example: Tesla
IT/ Computer Programming- Generative AI tools such as ChatGPT and Gemini have sparked concerns about AI potentially replacing jobs that involve a lot of writing. Unlike human language, which demands significant creativity and subtlety, programming uses a more structured and straightforward language. Since ChatGPT can already generate code, entry-level programming positions might soon be automated. Lay-off examples: Salesforce, Duolingo, and even AI hardware startup Humane have also announced layoffs or hiring freezes as a part of an effort to focus on AI.
Clerical and Data Entry- Many administrative duties performed by paralegals fall within the capabilities of AI. AI's proficiency in processing vast amounts of complex data allows it to write legal reports, gather case facts, sort through documents, and conduct legal research. This potential for increased efficiency in legal firms could eventually make the paralegal role obsolete.
Finance- Financial traders are responsible for analyzing markets and advising investors, but AI can perform these tasks much more quickly. AI trading technologies can also predict market trends with greater accuracy than humans. These capabilities, along with AI's ability to reduce hiring costs, suggest that the role of financial traders could soon become obsolete. Lay-off example: Google's Finance team
Of course, this isn't all doom and gloom. When automobiles came to market, they probably started putting horses out of business, but also created new jobs. The same will probably happen here as well.
However, if you are at the tail-end of your career and not interested in learning a new skill, these are the best franchise categories to insulate yourself in case of lay-offs:
Medical- Americans aren't getting younger or healthier. There are rock-solid franchises that help people without a medical background get into this sector. Additionally, the senior population is at an all-time high. The demand for care is here, and it will be quite a while before it's automated.
Insurance based- I am obsessed with franchises that afford you the ability to bill insurance. These are roofing, water damage, mold remediation, and more. This is a need, not a want, business that can insulate you from ups and downs in the economy.
Home Services- You may have a smart home, but when the stuff hits the fan, your app isn't fixing anything. In fact, with technology and smart appliances there tends to be more stuff to break.
Education- This is self-explanatory. There is a growing need for education and child services. The impact of a year of "zoom" school caused tutoring to sky rocket and an already taxed educational system has parents seeking solutions.
If you are looking to invest in an AI resilient business, or just exploring franchises in general, book a call with our team. We have hundreds of pre-screened brands that we partner with.
Sources:
McKinsey & Company, "Jobs lost, jobs gained: What the future of work will mean for jobs, skills, and wages."
Oxford Economics, "How Robots Change the World: What automation really means for jobs and productivity."
PwC, "Will robots really steal our jobs? An international analysis of the potential long term impact of automation."
World Economic Forum, "The Future of Jobs Report 2020."
LinkedIn Learning, "2020 Workplace Learning Report."
International Franchise Association, "The Economic Impact of Franchised Businesses."
Franchise Direct, "Top 100 Global Franchises."
Entrepreneur, "What You Need to Know About Franchise Training Programs."
U.S. Small Business Administration, "How Franchises Create Jobs in America."
Franchise Business Review, "The Role of Franchising in Local Communities."
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