Generative AI could add between $2.6 trillion and $4.4 trillion to the global economy annually (roughly 2 percent to 4 percent of the world’s combined gross domestic product this year), according to a new report.
What's new: The management consultancy McKinsey projected generative AI’s impacts on productivity, automation, and the workforce in a new report.
How it works: The authors examined adoption scenarios between 2040 and 2060 and their effect on labor productivity through 2040. They evaluated the business impact of generative AI use cases — for instance, large language models applied to customer service — and estimated the economic value those cases would create if they were applied globally. They also assessed the technology’s potential to automate tasks in roughly 850 occupations based on an occupation’s sensory, cognitive, physical, language, and social requirements.
- The high-tech sector is poised to receive the biggest economic boost, as generative AI, if universally adopted, could add between 4.8 to 9.3 percent to its current value. Banking, education, pharmaceuticals, and telecommunications also could experience a large impact, boosting each sector’s value by 2 to 5 percent.
- Four sets of activities — sales and marketing, software engineering, customer operations, and product research and development — represent 75 percent of total potential economic gains.
- In a survey of eight countries that include both developed and developing economies, the authors found that generative AI is likely to automate tasks in relatively high-paying jobs such as software engineering and product development. It will automate the most tasks in jobs that pay in the highest or second-highest income quintiles.
- Generative AI could automate 50 percent of all work tasks between 2030 and 2060. The technology is most likely to automate tasks that require logical reasoning and generating or understanding natural language.
Behind the news: Generative AI’s potential to displace human workers is causing substantial anxiety among the general public. A recent CNBC survey of 8,874 U.S. workers found that 24 percent of respondents were “very worried” or “somewhat worried” that AI would make their jobs obsolete. Respondents were more likely to worry if they were younger (32 percent of respondents of age 18 to 24 compared to 14 percent of those 65 or older), identified as part of a minority (38 percent of Asian respondents, 35 percent of Hispanic respondents, and 32 percent of black respondents versus 19 percent of white respondents), or earned a relatively low income (30 percent of respondents who earn less than $50,000 annually versus 16 percent of those who earn more than $150,000).
Yes, but: As the saying goes, it’s difficult to make predictions, especially about the future. A decade after a 2013 Oxford University study predicted that 47 percent of U.S. jobs were at risk of automation, the U.S. unemployment rate is nearly at record lows. A 2022 study found that employment rates have risen in occupations previously believed to be at risk from AI and robotics.
Why it matters: Generative AI already is having a noticeable effect on venture investments. This analysis indicates that current changes may herald disruptive impacts to come.
We're thinking: Prospective economic gains are good news, but they should be considered in a broader context. We see a real risk that AI may become so good at automating human work that many people will find themselves unable to generate substantial economic value. The best path forward is to democratize the technology so everyone can benefit and make sensible decisions together.
Why it matters: Generative AI already is having a noticeable effect on venture investments. This analysis indicates that current changes may herald disruptive impacts to come.
We're thinking: Prospective economic gains are good news, but they should be considered in a broader context. We see a real risk that AI may become so good at automating human work that many people will find themselves unable to generate substantial economic value. The best path forward is to democratize the technology so everyone can benefit and make sensible decisions together.