“We will expand the proportion of artificial intelligence (AI) budgets to the level of advanced countries and open the era of 100 trillion won in private investment.” It is a key blueprint for the AI era proposed by the Lee Jae-myung government.
However, can this direction of investment be closely linked to the domestic market, job creation, and the expansion of small business sales. At present, it is difficult to say that a specific answer to this is sufficiently presented.
In fact, even in the United States, which is at the center of the AI industry, the recent employment structure is not easy. Last year, Microsoft cut about 3% (6,000 people) of its workforce, Intel cut 20% (22,000 people) and Meta cut about 3,600 jobs. This is why we are still cautious to see AI as a solution to all problems.
In this regard, an interesting perspective was presented at a recent international conference hosted by the Bank of Korea. “The spread of AI technology brings greater productivity improvement in the consumer goods industry than in the capital goods industry, and drives about 35% of GDP and consumption growth in the short and long term,” said Leonardo Gambakorta, head of the BIS’s department. It is explained that AI has a greater economic effect in industries closely related to consumer goods distribution than in capital goods industries such as ships, vehicles, and machinery.
The consumer goods distribution industry is an area where the influence of AI technology is clearly shown. AI is used for product recommendations, logistics route optimization, and customer customization services, resulting in new jobs in various occupational groups and positive effects on the expansion of sales channels for small and medium-sized companies. In the online distribution industry, AI→logistics innovation→delivery efficiency→consumption expansion→small and medium-sized enterprises are forming a virtuous cycle structure.
A typical example is Coupang. Coupang, which has invested more than 6 trillion won in AI technology and logistics infrastructure for 10 years, has created about 80,000 jobs by operating more than 100 distribution centers across the country. The delivery area has been expanded to mountainous areas of islands such as Jeju, and tens of thousands of consigned delivery driver jobs have been created in the area.
In addition, large retailers such as E-Mart and Lotte Mart are also strengthening recommended services and national delivery systems that incorporate AI technology.
However, some regulations, such as the Distribution Industry Development Act, which restricts these companies’ integrated online and offline services, are still pointed out as obstacles to growth. If the mandatory closure system is eased and store-based online dawn delivery is fully allowed, companies will become more active in AI investment, which will soon lead to more job creation and increased sales of small and medium-sized merchants.
The same goes for delivery apps such as “Baedal Minjok.” It provides efficient services with AI-based recommendation algorithms while simultaneously supporting the livelihood of numerous riders. Delivery apps need to be viewed as a digital-based living infrastructure that contributes to boosting jobs and consumption, not just as a “fee regulation.”
The new government’s policy to foster the AI industry has a clear direction and is future-oriented. However, if the goal is to stabilize the national economy and people’s livelihoods, policy support and system improvement for AI-based consumer goods and distribution industries should be discussed as well as deregulation of high-tech technologies.
[Hwang Yongsik, professor of business administration at Sejong University]
