AI is pervasive. Here’s when we’ll see its real economic benefits materialize
- Human Editor
- Apr 2, 2024
- 4 min read
The productivity and growth conundrum Right now, technology is advancing faster than ever, but productivity is not. A recent McKinsey report shows labor productivity in the U.S. has grown at a lackluster 1.4%. This is no longer a matter of choice.” The formula for GDP growth has historically been population growth + productivity growth + debt growth. Aging populations and a shrinking workforce could lead to significant talent gaps, especially in terms of highly skilled and educated workers and as skills-first training and hiring continue to ramp up. That leaves productivity gains as our main driver of GDP growth. AI is the answer to the productivity problem–but only if it can be developed and deployed responsibly and with clear purpose.
Reaping the benefits on responsible AI Gartner estimates $5 trillion in technology spending in 2024, growing to $6.5 trillion by 2026. But responsibility and disruption can–and must–co-exist. I meet with clients daily–and I’ve seen four priorities emerge in the path to adoption: Model choice, governance, skills, and open AI.Providing model choice is critical to accelerating AI adoption. It may mean the evolution of jobs in the near term. Rob Thomas is SVP of Software and Chief Commercial Officer at IBM.
Artificial Intelligence (AI) has been a topic of interest and discussion for many years, with promises of revolutionizing various industries and improving efficiency, productivity, and innovation. Despite the excitement surrounding AI, there is still much debate about when we will see its real economic benefits. While some argue that the benefits are already apparent, others believe that we have only scratched the surface of what AI can do for the economy. In this essay, I will explore some of the key factors that will contribute to the realization of AI's true economic benefits and when we can expect to see them.
One of the main reasons why the economic benefits of AI are not fully realized yet is the lack of adoption and integration of AI technologies in businesses and industries. Many companies are still in the early stages of incorporating AI into their processes and operations, which limits the potential impact that AI can have on their bottom line. As more companies begin to fully embrace AI and integrate it into their core operations, we can expect to see substantial economic benefits in terms of increased efficiency, productivity, and cost savings.
Another factor that will contribute to the realization of AI's economic benefits is the ongoing development and enhancement of AI technologies. AI is a rapidly evolving field, with new advancements and breakthroughs being made on a regular basis. As AI technologies continue to improve and become more sophisticated, we can expect to see even greater economic benefits in terms of automation, predictive analytics, and decision-making capabilities. The ongoing investment and research in AI will play a crucial role in driving economic growth and innovation in the coming years.
The widespread availability and accessibility of AI tools and platforms will also play a key role in unlocking the true economic benefits of AI. As AI technologies become more democratized and accessible to businesses of all sizes, we can expect to see a greater adoption of AI across various industries. This will not only drive increased innovation and competitiveness but also create new opportunities for economic growth and development. The democratization of AI will empower businesses to leverage the power of AI to improve their operations, enhance customer experiences, and drive revenue growth.
In addition to adoption and accessibility, the integration of AI with other emerging technologies such as the Internet of Things (IoT), blockchain, and cloud computing will also contribute to the realization of AI's economic benefits. By combining AI with these technologies, businesses can create a more interconnected and intelligent ecosystem that can drive efficiencies, create new revenue streams, and enhance customer experiences. The convergence of AI with other emerging technologies will enable businesses to leverage the power of data and analytics to drive innovation and growth in ways that were previously unimaginable.
Furthermore, the application of AI in new and emerging industries such as healthcare, transportation, and energy will also play a significant role in driving economic benefits. AI has the potential to revolutionize these industries by enabling new levels of automation, efficiency, and personalized services. In healthcare, for example, AI can be used to improve patient outcomes, reduce costs, and enhance decision-making. In transportation, AI can optimize routes, reduce emissions, and improve safety. In energy, AI can help optimize energy consumption, reduce waste, and increase efficiency. The application of AI in these industries will not only drive economic growth but also create new opportunities for job creation and innovation.
Another important factor that will contribute to the realization of AI's economic benefits is the development of AI talent and expertise. As AI becomes more integral to businesses and industries, there will be a growing demand for professionals with AI skills and expertise. Companies that invest in talent development and training will be better positioned to leverage the full potential of AI and drive economic growth. Additionally, the collaboration between academia, industry, and government will be essential in nurturing a skilled workforce that can harness the power of AI to drive innovation and economic development.
Moreover, the ethical and regulatory considerations surrounding AI will also play a crucial role in unlocking its true economic benefits. As AI technologies become more powerful and pervasive, there will be growing concerns about data privacy, security, bias, and accountability. Addressing these ethical and regulatory challenges will be essential in building trust and confidence in AI and its economic potential. Companies that prioritize ethics and transparency in their AI practices will be better positioned to unlock the economic benefits of AI and drive sustainable growth.
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