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Will Artificial Intelligence increase economic growth?
Friday 09 February 2024
Research / Market
Will Artificial Intelligence increase economic growth?
February 2024| Recent advances in the development of artificial intelligence (AI) could lead to potentially disruptive changes across a wide range of industries. Will AI significantly increase aggregate economic growth through its impact on labor markets and increases in productivity? And will it enhance the productivity of labor or displaced workers? We believe that it is inevitable that AI will be widely adopted in the long term, and that it will have a positive impact on productivity and economic growth. But while it could be a huge gain for countries where the labor force is projected to decline, investors should be mindful that AI will be disruptive in the short term and will likely adversely affect profitability and returns in a number of sectors.
01 | Global investment in artificial intelligence (AI) is rapidly increasing across sectors, from manufacturing to services, with a focus on generative AI, leading to higher output in the sectors most involved. Higher capital per worker is also likely to drive future potential growth.
02 | The debate about AI as a substitute or complement to human labor is misplaced in the short term, as it can be both. The latest wave of AI is different from past technological innovations, as it affects creative and cognitive jobs as well as physical ones and routine cognitive tasks.
03 | The impact of AI on labor displacement is still uncertain, but we believe re-skilling workers will become more important as some skills become obsolete or must adapt to work with AI. While there will be some displaced workers, there will also be new jobs and new types of jobs.
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Unless otherwise stated, all information contained in this document is from Amundi Asset Management as of January 24, 2024. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the [author] and not necessarily Amundi Asset Management and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product or service. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not indicative of future results. Amundi US is the US business of Amundi Asset Management.
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