Artificial intelligence threatens to replace a third of the workforce working for small businesses in Australia

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More than a third of small businesses in Australia have already planned – or plan to – replace some of their workforce with AI, a new survey has revealed.

It also found that 56 percent of small business operators believe AI will either reduce the number of people they employ or are unsure about the impact it will have on staffing.

The use of AI by small businesses is increasing, with 41 per cent of Aussie small businesses saying they use it, compared to just 26 per cent of UK small businesses.

Among those Aussie small businesses using AI, the top three tasks where it is being used are:

• Administrative functions – 39 percent

• Creative writing – 28 percent

• Drafting of internal or company communications – 20 percent.

A survey by business consultancy Peninsula Group found that small businesses have many concerns about introducing AI.

Top of the list of concerns are increased security risks, followed by higher margins for error and the risk of AI affecting the quality of work.

Reputational risk of using AI was the lowest-ranked concern, indicating how accepted technologies such as ChatGPT and Google Bard have become in a relatively short period of time.

David Price, NZ CEO of Employers, a subsidiary of the Australia and Peninsula Group, whose small business clients were among those taking part in the survey, told that AI can be a great tool when used with people. Instead of them.

“I was interested to see that a third of employers believe that AI will reduce the number of employees in their company. AI is only as good as the way it is programmed and cannot substitute for knowledge and personal insight.”

Mr Price said small businesses were right to be concerned about the security risks of using AI.

“We do not allow ChatGPT on any of our corporate machines, as it damages intellectual property. We did a global risk analysis and we felt that some of these questions could actually (expose) our sales processes and our service processes, which are quite unique.”

He said that as AI systems improve their algorithms based on machine learning, there is a real risk of businesses compromising their proprietary knowledge.

“If you put your marketing, creative writing, some internal com data, is somebody going to use it?”

Mr Price added that the security of data, and particularly third-party data, accessing unregulated AI platforms is also a concern for all businesses, regardless of their size.

“Concerns around security make sense, given the general risk that employers are opening themselves up to potential cyberattacks due to the increased use of unregulated AI platforms.”

79,000 businesses were surveyed in Australia, Canada, Ireland, New Zealand and the UK.

Ireland has the highest adoption of AI of the five countries surveyed, with 10 percent of Irish workers saying it is regularly used in their business – twice the number in Canada, NZ and the UK.

Canadians were the most cautious, with 17 percent of employers labeling AI as “extremely harmful.”

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