Geelong’s economy survived the shock of Ford and Alcoa closures by transitioning to more service industries. Picture: Alan Barber
Having successfully transitioned from losing manufacturing industries in the 2010s, Geelong is back on the frontline bracing for the impact of AI on 21st century jobs.
New research reveals the potential job impacts from disruption and productivity gains from the uptake of artificial intelligence across industries, and how that could impact local property markets.
Modelling produced by SuburbTrends data scientist Kent Lardner placed Geelong among the top 10 urban regions, with about 32,000 jobs potentially at risk from AI.
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Mr Lardner said Sydney and Melbourne would be most impacted by the AI revolution, with Victoria particularly vulnerable because of how many people worked in professional services jobs.
More than 51,000 were at risk in both inner Sydney and Wyndham, the modelling showed, with another 14,000 jobs on the Bellarine Peninsula and Surf Coast.
“There is a very big representation of affected suburbs in Melbourne and Geelong. That was a big standout, just how much of this appears in Victoria and Melbourne,” Mr Lardner said.
Sectors with most jobs at risk are IT and telecommunications, professional, scientific and technical services and finance and insurance.
IT and telecommunications, professional, scientific and technical services and finance and insurance are the sectors most at risk of AI-related productivity. Picture: Alan Barber
Geelong’s southern suburbs and Torquay could be among the worst hit with about 12,000 jobs at risk, the modelling shows, including a large number of while collar jobs in those sectors, along with health care and social assistance and retail trade.
Mr Lardner said the worst-case scenario is that AI would create “rust-belt suburbs” as Australia exported white collar jobs, where mass people are leaving, or selling their homes at once because they’ve lost jobs, that could cause house prices to tumble.
Two variables would determine how much of an impact AI would have on the workforce, Mr Lardner said – whether the technology would be good enough to replace workers in a few years’ time, and whether companies would freely embrace the technology.
SuburbTrends data scientist Kent Lardner has modelled the impact of AI on jobs.
Mr Lardner said the experience of Geelong after the 2010s closures of Ford and Alcoa could give a clue as to what may happen in parts of Sydney, Melbourne and other major cities.
Parts of these cities saw an exodus of residents following job closures, he said.
“A key difference is that white collar workers and blue collar workers were distributed differently across cities, Mr Lardner said.
“I would argue the work-from-home trend has distributed some of the risk so you wouldn’t have as many people all in the same place,” he said.
“That said, there are still clusters where there is a fairly high concentration of workers in the same industries or at the same companies.”
Real estate agent Nick Lord said Geelong’s affordability and lifestyle meant it was well positioned to deal with AI’s potential impact on the economy. Picture: barefoot Media
While the region’s economy diversified in the wake of losing the major manufacturing sector, growing the number of white collar jobs, Geelong’s emergence as a key affordable lifestyle market bolstered the region’s ability to cope with the AI revolution.
Veteran Geelong real estate agent and Maxwell Collins director Nick Lord said the region was well placed to deal with the fallout of AI disruption, as it had the Covid pandemic.
Mr Lord said Geelong’s relative affordability remained a key reason many people continue to migrate to the region.
“Reflecting back then (to Alcoa and Ford closures) it didn’t really alter the market,” Mr Lord said.
“There was obviously some people who, like any industry were suffering hardship due to job loss or job change.
Geelong’s large white collar sector is at risk from the impacts of AI. Picture: Alan Barber
“But I think Geelong forever is going to be positioned so well, just clearly geographically we’re not moving and the migration out of Melbourne will continue to happen.
“So when they’re finding financial pressure there, they’ll move out to the outer suburbs, I think that’ll continue to underpin our market and it certainly did back in the Ford and Alcoa days.”
Geelong buyers advocate Tony Slack it would need a seismic shift to see thousands of people selling their houses and leaving because they had been made redundant to AI.
“It’s pretty extreme to sell your home and move out of an area that you’re close with your family, friends, networks and lifestyle.
“It’s an extreme measure to see that all of a sudden there’s a glut of houses on the market because people are leaving in droves, because their industry has changed.”
with Aidan Devine
English (US) · 