World Bank Warns AI Could Disrupt Jobs Across Pakistan’s Services Sector

A recent World Bank report warns that artificial intelligence (AI) could drastically alter the job landscape in Pakistan, particularly within the service sector. According to the study, titled "Job Opportunities and AI in Pakistan," a significant portion of service sector workers are already exposed to AI, with 61% working in roles with above-median AI exposure. The report emphasizes the dual nature of AI's impact, noting both the potential for increased productivity and the risk of job displacement.

The average occupational AI exposure score in Pakistan in 2024 was found to be 0.48 standard deviations below the median, indicating a considerable disparity in AI adoption across industries. However, the service sector stands out as the most vulnerable to AI disruption. More than 80% of workers in wholesale and retail trade, finance, insurance, real estate, and education are estimated to have high AI exposure, compared to 7% of manufacturing workers and 5% in other industrial sectors. Agriculture, the least exposed sector, has an exposure rate of less than 1%.

Despite AI exposure not necessarily equating to job loss, the World Bank has identified that 18% of employed workers in Pakistan are poised to benefit from both high AI exposure and opportunities for human-AI collaboration. Conversely, only 8% work in high-exposure occupations with limited potential for AI assistance, suggesting that a smaller fraction of jobs face a significant risk of automation.

Industries like real estate and education are poised to leverage AI to enhance productivity and efficiency, as the technology can augment these fields. However, the wholesale and retail trade sector, characterized by both high AI exposure and a sizable workforce, poses a critical challenge for Pakistan's transition to an AI-driven economy.

Agriculture, while employing a significant portion of the labor force, remains largely unaffected by direct AI exposure but could still see improvements in productivity through technological advancements.

The report underscores the critical role of workforce preparedness and business adoption of AI technologies in determining the outcome of AI's impact on the Pakistani job market. It emphasizes the need for relevant skills development and supportive investments to ensure that AI serves as a catalyst for productivity gains rather than a source of job displacement.

As policymakers and industry stakeholders navigate these challenges, the World Bank's report serves as a crucial reminder of the urgent need for strategic planning in Pakistan's evolving AI landscape.