The $2.6 trillion to $4.4 trillion figure marks a huge increase over McKinsey’s previous estimates of the generative AI field’s impact.
It seems like the leadership of nearly every big company is excited about generative AI these days and rushing to announce or embrace new AI tools. But what impact will their moves have on the economy?
While it’s difficult to say for certain, global consulting leader McKinsey and Company — where GenAI is already in use by roughly half the workforce — has attempted to quantify the trend in a new report, The economic potential of generative AI.
The report finds that GenAI could add “$2.6 trillion to $4.4 trillion annually” to the global economy, close to the economic equivalent of adding an entire new country the size and productivity of the United Kingdom to the Earth ($3.1 trillion GDP in 2021).
To construct the report, McKinsey’s analysts examined 850 occupations and 2,100 detailed work activities across 47 countries, representing more than 80% of the global workforce. A bigger impact on an accelerated timeline
The $2.6 trillion to $4.4 trillion economic impact figure marks a huge increase over McKinsey’s previous estimates of the AI field’s impact on the economy from 2017, up 15 to 40% from before. This upward revision is due to the incredibly fast embrace and potential use cases of GenAI tools by large and small enterprises.
Furthermore, McKinsey finds “current generative AI and other technologies have the potential to automate work activities that absorb 60 to 70% of employees’ time today.”
Does this mean massive job loss is inevitable? No, according to Alex Sukharevsky, senior partner and global leader of QuantumBlack, McKinsey’s in-house AI division and report co-author.
“You basically could make it significantly faster to perform these jobs and do so much more precisely than they are performed today,” Sukharevsky told VentureBeat.
What that translates to is an addition of “0.2 to 3.3 percentage points annually to productivity growth” to the entire global economy, he said.
However, as the report notes, “workers will need support in learning new skills, and some will change occupations. If worker transitions and other risks can be managed, generative AI could contribute substantively to economic growth and support a more sustainable, inclusive world.
