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An Investing Megatrend: How Technological Breakthroughs are Shaping the Future

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Since Apple released the first iPhone in 2007, few industries have been left unaffected.

This transformational device is a prototypical example of a technological breakthrough. It was a tipping point in turning entire business models upside-down, while also impacting our everyday lives at a more fundamental level.

New growth opportunities emerged from the ensuing disruption, while many status quo solutions were rendered obsolete.

Technological Game-Changers

Today’s infographic from BlackRock highlights the pervasive and positive impact that technological breakthroughs can have on the global economy.

Technological Breakthroughs Infographic

Fueling the Flames of Innovation

According to recent data from Accenture, it’s estimated that 71% of businesses are on the brink of being disrupted.

In fact, disruptive innovation most often emerges in two scenarios:

  • New solutions to existing problems or challenges that have proven difficult to solve
  • New competitors in highly profitable sectors with historically high returns

The occurrence of technological breakthroughs can also be accelerated through several factors, including significant demographic shifts, sustained economic growth, innovative political environments, and urgent societal needs.

Technological Adoption is Speeding Up

Breakthrough inventions have always sent ripple effects throughout society, but today those ripples are travelling faster than ever.

Moore’s Law – the assertion that number of components in a dense integrated circuit (i.e., transistors, resistors, diodes, or capacitors) will double every year, while still getting cheaper – is one factor. Similar examples of staggering increases in utility for less cost can be found in a number of other instances, from DNA sequencing to data storage.

The rate of technological adoption is also speeding up. For example, consider the mobile phone─due to the price point and ease of use, the number of U.S. adults with a cell phone jumped from 10% in 1994 to over 96% in 2019. This is also evident in new technologies such as smart speakers, where the adoption rate in the U.S. is expected to double to 55% in less than 3 years.

Breakthrough Investment Opportunities

Where innovation leads, investment usually follows. However, predicting which technological innovations will have a lasting impact on society has often proved difficult.

Instead, investors can track the wider trends that often spark technological disruption, in order to unlock potential opportunities:

  1. Research and Development Funding:
    The number of investments in emerging technologies is growing. Tech company acquisitions also totalled US$278 billion by Q2 2018—a 50% increase from the year before.
  2. The Future Workforce:
    Historically, productivity gains have increased the demand for more skilled labour. Technical and soft skills are top priorities for employers for their future teams, and it it’s projected that the amount of hours that workers spend using technological skills will increase by 55% from 2016 to 2030.
  3. Shifts in Consumer Demand:
    Companies aware of these factors should seek to incorporate innovations into their platforms for a more customer-centric experience.
  4. Societal Needs:
    Persistent global social issues such as access to better healthcare are drivers of innovative solutions that offer a better quality of life. Symphony Post-Acute Network harnessed artificial intelligence (AI) and machine learning (ML) to be able to offer personalised healthcare for over 80,000 patients─cutting costs by more than US$13,000 per patient.

Future Impact of Technological Innovation

Technological change will likely continue to accelerate, and investors should tailor their portfolios accordingly.

At the same time, traditional barriers to entry for new competitors are consistently being eroded by these breakthroughs, sending industries into flux and creating potential new opportunities.

Humanity’s co-evolution with technology will continue to profoundly impact the economy, while improving life on Earth in unimaginable ways.

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AI

Visualizing the Top U.S. States for AI Jobs

Nearly 800,000 AI jobs were posted in the U.S. throughout 2022. View this graphic to see a breakdown by state.

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Visualizing the Top U.S. States for AI Jobs

Much ink has been spilled over fears that artificial intelligence (AI) will eliminate jobs in the economy. While some of those fears may be well-founded, red-hot interest in AI innovation is creating new jobs as well.

This graphic visualizes data from Lightcast, a labor market analytics firm, which shows how many AI-related jobs were posted in each state throughout 2022.

In total there were 795,624 AI jobs posted throughout the year, of which 469,925 (59%) were in the top 10. The full tally is included in the table below.

RankStateNumber of job postings% of total
1California142,15417.9%
2Texas66,6248.4%
3New York43,8995.5%
4Massachusetts34,6034.3%
5Virginia34,2214.3%
6Florida33,5854.2%
7Illinois31,5694.0%
8Washington31,2843.9%
9Georgia26,6203.3%
10Michigan25,3663.2%
11North Carolina23,8543.0%
12New Jersey23,4472.9%
13Colorado20,4212.6%
14Pennsylvania20,3972.6%
15Arizona19,5142.5%
16Ohio19,2082.4%
17Maryland16,7692.1%
18Minnesota11,8081.5%
19Tennessee11,1731.4%
20Missouri10,9901.4%
21Oregon10,8111.4%
22Washington, D.C.9,6061.2%
23Indiana9,2471.2%
24Connecticut8,9601.1%
25Wisconsin8,8791.1%
26Alabama7,8661.0%
27Kansas7,6831.0%
28Arkansas7,2470.9%
29Utah6,8850.9%
30Nevada6,8130.9%
31Idaho6,1090.8%
32Oklahoma5,7190.7%
33Iowa5,6700.7%
34South Carolina4,9280.6%
35Louisiana4,8060.6%
36Kentucky4,5360.6%
37Nebraska4,0320.5%
38Delaware3,5030.4%
39New Mexico3,3570.4%
40Rhode Island2,9650.4%
41New Hampshire2,7190.3%
42Hawaii2,5500.3%
43Mississippi2,5480.3%
44Maine2,2270.3%
45South Dakota2,1950.3%
46Vermont1,5710.2%
47North Dakota1,2270.2%
48Alaska9700.1%
49West Virginia8870.1%
50Montana8330.1%
51Wyoming7690.1%

The following chart adds some context to these numbers. It shows how the percentage of AI job postings in some of the top states has changed since 2010.

We can see that California quickly became the primary destination for AI jobs in the early 2010s, presumably as Silicon Valley companies began developing the technology.

California’s share has since declined, with a significant number of jobs seemingly moving to Texas. In fact, many tech companies are relocating to Texas to avoid California’s relatively higher taxes and cost of living.

The 10 Most In-Demand Specialized Skills

Lightcast also captured the top 10 specialized skills that were required for AI-related jobs. These are listed in the table below.

SkillFrequency (number of postings)Frequency (% of postings)
Python296,66237%
Computer Science260,33333%
SQL185,80723%
Data Analysis159,80120%
Data Science157,85520%
Amazon Web Services155,61519%
Agile Methodology152,96519%
Automation138,79117%
Java133,85617%
Software Engineering133,28617%

If you’re interested in a career that focuses on AI, becoming proficient in Python is likely to be a good first step.

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