Almost 40% of Australian jobs that exist today have a moderate to high likelihood of disappearing in the next 10 to 15 years due to technological advancements, and financial services is not immune.
According to the Australia’s future workforce?
report, authored by the Committee for Economic Development of Australia (CEDA), Australia and the world is on the cusp of technological revolution.
“The pace of technological advancement in the last 20 years has been unprecedented and that pace is likely to continue for the next 20 years,” CEDA chief executive, Professor the Hon. Stephen Martin said.
The largest impact on future employment in financial services will come from the automation of jobs by computers and machines.
“Third are jobs which, while not always routine, will see increased productivity (and therefore relatively less employment for the same output) through application of robotics and machine-learning algorithms,” the report said.
“Health is an especially significant area likely to be impacted… Other examples include banking and legal advice – typically activities that involve a qualified professional, but where data and analysis play a large role, and where most, but not all, work is routine.”
This form of digital disruption is already evident in the mortgage and finance industry. Online-only lenders, such as loans.com.au and UBank are increasingly gaining traction in the market as they are able to pass their savings on overhead costs onto consumers in the form of much cheaper rates – and can offer it all from the comfort and convenience of the consumer’s couch.
Yellow Brick Road even announced the launch of its new robo-advice technology last week, which it says will shake up the financial advice industry. The new simulation technology, GURU, will allow consumers themselves to calculate the likelihood of reaching their financial goals based on their current situation.
However, the report reveals that the demand for “soft services” has been steadily increasing, despite ongoing technological disruption. In 1975, soft services – such finance, health, retail and education – accounted for just over 50% of all jobs. By 2014, the sector accounted for over 70% of all jobs.
In fact, households outsourced financial services more than any other activity in 2013-14. According to the report, the outsourcing of financial services accounted for 21.6% of a household’s spending on outside services, followed by health services at 20% - proving that consumers still appreciate professional and personal service in a digital world when it comes to their finances.