AI puts more than half of Cyprus workforce in exposed jobs

Many businesses have been pushing their workers to employ artificial intelligence to carry out their tasks, prompting fears that this drive for efficiency may in time see companies cut out the human element of some roles entirely, causing job losses or, at the very least, fewer openings in the future.

In the United Kingdom, those fears have already become a reality for some, with Barclays, one of the country’s largest banks, announcing plans to cut around 5,000 staff in the next two and a half months as it increases its reliance on AI.

Meanwhile, in neighbouring Ireland, Politico has reported that the country’s “lucrative tech sector” has been “rattled by waves of AI-driven layoffs” – words which sent shivers down the spines of workers in Limassol, where forex and fintech employ swathes of Cyprus’ richest city’s current population.

According to a report issued by the European Commission last week, 56 per cent of the Cyprus’ workforce is currently employed in job which is “highly exposed” to AI, while 27 per cent of those working in the private sector are at “risk of job displacement”, or, in other words, being laid off through no fault of their own.

Fears of job losses ‘entirely logical’

Trade union Peo’s deputy secretary-general Christos Tombazos told the Sunday Mail that fears of job losses are “entirely logical”, and suggested that the transformation of the world of employment brought about by AI may rival the changes brought about by the industrial revolution.

“These are changes which we are seeing happen very quickly which are changing the way people work,” he said, before stressing that his union is “not against technology or its development”, but that it “must be done to the benefit, and not to the detriment, of society”.

His union has previously published similar positions on the permeation of AI into the workforce, calling for the maintenance of human oversight in decision-making, and also warning out that in professions such as law, the undertaking of “menial” tasks by AI risks preventing young lawyers and fresh graduates from acquiring the requisite experience to go on and have accomplished careers.

As such, he called for education systems to be modernised so as to prepare young people for AI in the workplace, rather than for AI to be used to cut young people out of it.

This last sentiment was shared by Cyprus chamber of commerce and industry (Keve) secretary-general Philokypros Rousounides, who told the Sunday Mail that “the right education will allow people who are already in the workforce and people who are entering it to take advantage of AI and to be adaptable, and therefore make their work more efficient”.

He added that it is “too premature” to say whether the rise of AI has caused layoffs in Cyprus, before adding that “if we manage the matter correctly, we will not have job losses here”.

Layoffs ‘particularly’ possible in service sector

Andreas Matsas, the leader of trade union Sek, told the Sunday Mail that at present, “there is no evidence of mass layoffs” having occurred in Cyprus as a result of AI, and called for the matter to be dealt with “at the European level”.

Similarly to Tombazos, he called for regulations to ensure that there is a “human in control” of artificial intelligence-based decision-making in the workplace, though he warned that job losses may be inevitable.

“Particularly in the service sector, in places such as accountancy firms and in law firms, there may be layoffs,” he said, though he did stress that “thus far, we do not have any indications of layoffs”.

Additionally, while he stressed that regulation at the European level may be the most productive way to ensure jobs amid the rise of AI, he was keen to point out that Cyprus is further ahead than the EU on a number of “modern” workers’ rights.

He cited the fact that Cyprus’ parliament has already approved legislation outlining remote workers’ rights in the aftermath of the Covid-19 pandemic, including the “right to disconnect”, which explicitly empowers remote workers to become uncontactable outside of their regulated working hours.

‘No evidence of job destruction’ in EU yet, report says

At the European Union level, the right to disconnect still rests upon the 2003 working time directive, which predates much of the technological advancements which have facilitated working from home. The European Parliament voted in 2021 to implement the right to disconnect, but this has not been followed up by the European Commission or the Council of the EU.

On the matter of the rise of AI, the European Commission’s directorate-general for employment, social affairs, and cohesion (DG-EMPL) last week released a report stressing that thus far, “there is no evidence of net job creation or destruction from AI in the EU”, and that the “main effect” of AI has been “observed at task level”.

However, it did warn that “AI alone could reduce net job creation by about 300,000 by 2035, or by about one million when broader automation is included”, though it offered reassurance that these million forecast lost jobs will be “partly offset by about 900,000 new jobs in research and development and information technology”.

The report also warned of a “hiring slowdown since 2022 in occupations with high AI use”, which it said has “affected young and prime-age workers similarly”.

“Several confounding factors may contribute to this: macroeconomic caution, remote work, and trends predating AI,” it said.

EU promises ‘skills guarantee’ to safeguard jobs

Regarding young workers in particular, the report said that the “jury is still out” on the impact of AI on their careers, but the International Monetary Fund took a stronger and dimmer view on the future of Cyprus’ workforce amid the rise of AI.

Asked by the Sunday Mail what measures are being taken to safeguard jobs amid the rise of artificial intelligence, a European Commission spokesperson made reference to the new “European Skills Guarantee” initiative.

The spokesperson said the initiative aims to “support workers at risk of unemployment by improving job transitions, providing targeted up- and reskilling programmes and employment support”.

Additionally, they highlighted the planned “Quality Jobs Act”, a new initiative which the commission hopes will “improve working conditions, health and safety, and workers’ rights across the EU”.

IMF says Cypriot workforce not prepared for rise of AI

This, the spokesperson said, will ensure that as artificial intelligence changes the workplace, “the EU regulatory labour law framework remains fit for purpose”.

However, these regulatory plans notwithstanding, the IMF, too, warned of “gaps in AI preparedness” among Cyprus’ population, saying that while the use of AI is “high” among the general population, “its use in economic activities remains limited”.

In other words, while many of us have in recent times found ourselves on the receiving end of e-mails composed by AI, and we all know at least one person who swears by it to hold their hand through even the most basic of tasks, as far as the IMF is concerned, the Cypriot workforce is not ready for what is coming.