With artificial intelligence (AI) revolutionising industries worldwide, it is exciting (and perhaps, for some, daunting) that our region will be no exception. Last year, our June quarter Business Conditions Survey found that 59 per cent of Illawarra businesses were receptive to the adoption of AI in their business operations. By now we expect that figure to be even higher.
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It's what's known in political circles as a 'barbecue stopper', and currently a major focus for the Federal Government as it attempts to regulate this rapidly emerging technology to protect Australians while retaining its many productive attributes.
The integration of AI ... presents immense opportunities for businesses
The integration of AI in various sectors, such as manufacturing, healthcare, planning, education and transportation, presents immense opportunities for businesses. By leveraging AI-powered solutions, businesses can enhance efficiency, productivity and competitiveness, ultimately leading to job creation and economic prosperity. Research by Goldman Sachs found that AI will result in new jobs and a productivity boom which could increase the total annual value of goods and services produced globally by 7 per cent.
As we witness the rapid advancements in AI technology, it's crucial for local businesses and policymakers to embrace this transformative force to drive economic growth and innovation in the Illawarra. But, at the end of the day, we need to bring our labour force along with us for the ride through training, re-skilling, knowledge-sharing and education.
In the manufacturing sector, AI-enabled automation and predictive maintenance can optimise production processes, reduce costs and improve product quality. This not only boosts the profitability of local manufacturing companies but also positions the Illawarra region as a hub for advanced manufacturing technologies.
In healthcare, AI applications such as predictive analytics and personalised medicine have the potential to revolutionise patient care and treatment outcomes.
AI can also help accelerate government processes by harnessing the power of big data, improving productivity and reducing administration. We welcome the NSW Government's investment of $5.6 million to explore how AI (and other digital solutions) can be used to speed up the planning system, which was one of the key recommendations in our July 2023 Affordable Housing Solutions Report.
By adopting AI-powered tools and platforms, educational institutions can also enhance learning experiences and better prepare our workforce for the future. This will contribute to a more skilled and competitive labour market that can continue to keep up with AI-induced changes in our economy.
Of course, there are challenges which include potential job displacement and ethical concerns associated with AI implementation. However, by proactively reskilling workers, promoting ethical AI practices and ensuring inclusive growth the Illawarra will be able to navigate the complexities of AI adoption while maximising its economic benefits.
Our latest Business Conditions Survey revealed that increased wage expectations are affecting 61 per cent of businesses in the Illawarra, compared to only 51 per cent across NSW. With an unemployment rate in January more than double the NSW average and yet hiring rates on par with those of NSW, we can assume that staff cuts are emerging as a response to the cost increases for business and potentially that AI is already causing some displacement in the workforce.
This is not something new. Businesses have been embracing disruptive technologies for centuries, and with that there have been necessary changes to the labour force. The difference is the speed at which the current changes are taking place and our inability to adapt our skills as quickly to the ever-changing work environment.
There is a common misperception that there is a direct association between innovation (AI) and job losses, but it is important to not talk about AI as something that will happen to us, but rather as something already happening to us. It is not in the future, it is now. So how can we help support business through this ongoing transition? The answer is simple - talk about it, learn about it, acknowledge it and be future-looking in your skill development.
Our region benefits in many ways from being home to the world-class University of Wollongong and, through its investment in AI research and development, fostering collaborations with industry, and upskilling the local workforce in AI technologies, the Illawarra is already positioning itself as a leader in the AI revolution.
By embracing AI as a catalyst for innovation, productivity and growth, the region can unlock new opportunities, create sustainable economic development. It's time for the Illawarra to seize the potential of AI and pave the way for a thriving economy in the digital age. We are looking forward to hosting a Tech Summit for our members later this year where we hope to discuss how we cement our region's position as a leader in tech, AI and a community that knows how to use it to its advantage.
- Adam Zarth is Executive Director, Business Illawarra
