Key Insights
- AI investment will boost global labor productivity by more than 1 percentage point per year within a decade
- US businesses will need to make significant upfront investments
- According to analysts, by 2025 investments in AI around the world can reach $200 billion
Investing in artificial intelligence (AI) could have a larger impact on US gross domestic product (GDP) than the invention of electricity or personal computers. This is stated in the Goldman Sachs report.
AI has huge economic potential and could increase global labor productivity by more than 1 percentage point per year for a decade after its widespread use, said Goldman Sachs economists Joseph Briggs and Devesh Kodnani.
To achieve this transformation, US businesses will need to make “significant upfront investments in physical, digital and human capital to acquire and implement new technologies and change business processes.”
Our economists expect AI investment be driven primarily by investment in hardware to train AI models and execute AI queries, as well as increased spending on AI-enabled software,” Goldman Sachs said.
Long and short-term AI investment outlook
Analysts estimate that worldwide investment in AI could reach $200 billion by 2025. The influx of capital is likely to occur after “the adoption and efficiency gains begin to lead to significant productivity gains” in the sector.
Related: What are the Best AI Stocks to Buy Now in 2023?
In the long term, AI investment could peak at 2.5% to 4% of US GDP and 1.5% to 2.5% of other AI-leading countries. However, the short-term impact on GDP is likely to be rather modest given that AI-related investment currently represents a very small share of US and global GDP.
Therefore, the introduction of AI is likely to have a significant impact on the American US between about 2025 and 2030.
Anticipated effects of AI on the US economy
The Pew Research poll also showed that more than half of Americans (65%) believe that the introduction of artificial intelligence will have a “big impact” on their work life in the next 20 years. In their opinion, working with AI will lead to increased surveillance and mismanagement of data.
Related: SEC Chief Warns of AI Risks to Financial Stability
More than half of respondents – 56% – expect that AI will seriously affect the American economy. Only one in five (22%) believe that the impact of AI will be insignificant.
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