Generative AI could add trillions of dollars to the global economy, increasing the impact of all artificial intelligence by 15% to 40%, according to a new report from McKinsey Digital.
Entitled “The Economic Potential of Generative AI: The Next Productivity Frontier,” the report argues that generative AI is also poised to ignite the next wave of productivity.
“Our latest research estimates that generative AI could lead to $2.6 trillion to $4.4 trillion worth of growth annually across the 63 use cases analyzed. The UK’s total GDP was $3.1 trillion,” the report’s authors said.
“This estimate roughly doubles if we include the impact of embedding generative AI into software currently in use for other tasks beyond these use cases.”
stir the imagination
According to the report, generative AI applications such as ChatGPT Copilot, Stable Diffusion, and more are capturing the imagination of people around the world in ways no previous AI milestone has.
“Modern generative AI applications can perform a variety of everyday tasks such as data reorganization and classification,” the authors say.
“But their ability to write, compose music, and create digital art garnered headlines and persuaded consumers and households to experiment for themselves. We are grappling with the impact of type AI on business and society, but there is little context to understand it.”
The management consultancy firm believes that approximately 75% of the value that generative AI use cases can deliver lies across four areas: customer operations, marketing and sales, software engineering, and research and development (R&D).
After examining 63 use cases that use generative AI to address specific challenges and deliver measurable results, McKinsey found that banking, high tech, and life sciences were the industries with the greatest percentage impact. determined to be one of income.
The technology could add another $200 billion to $340 billion worth of value per year if the use cases are fully implemented, the company said. The potential impact on retail and consumer packaged goods is also huge, from $400 billion to $660 billion annually.
free up time
It also holds promise to change the way people work, potentially automating work activities that currently occupy 60% to 70% of an employee’s time.
“By contrast, we previously estimated that technology could potentially automate half the time employees spend on tasks,” the authors say.
“The accelerating potential for technical automation is largely due to the increased natural language understanding capabilities of generative AI for work activities that account for 25% of total work time.”
McKinsey estimates that the rapid acceleration of generative AI could mean that half of today’s work activities could be automated between 2030 and 2060, with the midpoint likely to be 2045, about 10 years earlier than previous projections. says there is.
Generative AI could also boost labor productivity growth by 0.1% to 0.6% annually through 2040. Combined with all other technologies, automating tasks could increase productivity growth by 0.2 to 3.3 percentage points annually, the report says.
“The excitement about this technology is clear, and the early pilots are compelling. have,” the report said.
“This includes managing the risks inherent in generative AI, determining what new skills and competencies employees need, and rethinking core business processes such as retraining and developing new skills.”
Please contact the author at stephen.gunnion@proactiveinvestors.com.
