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AI is Fashion Executives’ Top Priority in 2024: Industry Jobs Safe?

Last Updated March 7, 2024 3:38 PM
Samantha Dunn
Last Updated March 7, 2024 3:38 PM

Key Takeaways

  • A recent McKinsey survey reveals that artificial intelligence (AI) is now a top priority for fashion industry executives.
  • Executives aim to integrate AI into various aspects of their businesses, especially in design and product development.
  • AI-generated models may replace human models in the future, prompting some models to create their ‘digital twin’.
  • The International Monetary Fund suggests that AI could either augment or replace human roles in various sectors.

Close to three-quarters of fashion executives said AI was a priority for their companies in 2024. The analysis published by management consultancy McKinsey  in November 2023, outlines how, in the next three to five years, generative AI could add up to $275 billion to the apparel, fashion, and luxury sectors’ operating profits.

The British Fashion Model Agents Association urges caution against the growth of AI, noting the industry needs to be prepared for this and adapt its business model.

Digital Twins and AI Influencers

While AI offers productivity enhancements, it also raises concerns about job security.

Modeling agency The Diigitals  claims to be the world’s first all-digital modeling agency. A BBC  report highlighted models who are creating digital versions of themselves to secure their careers.

AI influencers such as Miquela Sousa, better known as @lilmiquela,   are driving forward a new type of fashion model. Considered one of the first AI influencers on Instagram, Miquela has over 2.6 million followers and has partnered with many fashion brands including Prada and Calvin Klein.

The British Fashion Model Agents Association is calling for the industry to adapt proactively to the rapid integration of AI as the International Monetary Fund (IMF) suggests that AI could either augment or replace human roles in various sectors, potentially impacting employment and wage levels.

AI Driving Big Tech Layoffs

The enthusiasm for AI is mirrored in the investment landscape, with equity funding for AI-focused startups in the fashion domain reaching an impressive $14.1 billion in the first half of 2023 alone. This surge in funding highlights the growing confidence in AI’s ability to transform the fashion industry.

However, fears surrounding the impact of AI on job security are already widespread. Big Tech has undergone several rounds of job cuts in the past couple of years.

Last year Google cut several hundred jobs from across its global teams, accounting for approximately 6% of its workforce.

Similarly, Spotify laid off approximately 1,500 employees with a substantial number of cuts made in the US.

US Jobs Not Safe from AI?

According to an IMF report, AI exposure is expected to be higher in advanced economies while emerging markets are predicted to face fewer disruptions from AI job takeover.

AI preparedness index.
AI Preparedness Index and employment share in high-exposure occupations.

Kristalina Georgieva, the IMF managing director, noted that “roughly half the exposed jobs may benefit from AI integration, enhancing productivity,” “For the other half, AI applications may execute key tasks currently performed by humans, which could lower labour demand, leading to lower wages and reduced hiring. In the most extreme cases, some of these jobs may disappear”.

The United States and China are the largest economies and the largest apparel retail markets in the world.

Given the fashion industry  has a global labor force of 3,384.1 million employees and is one of the key value-creating industries for the world economy, the fears surrounding AI- job takeover are very real.

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