The opportunities and the challenges are each enormous. An executive at one Fortune 500 company says his organization has carried out a comprehensive review of its use of analytics and concluded that its staff, overall, add little or no value. Rooting out the old software and replacing that inefficient human labor with AI might yield significant results. But, as this person says, such an overhaul would require big changes to existing processes and take years to perform.
There are some early encouraging signs. US productivity growth, stuck at 1% to 1.5% for greater than a decade and a half, rebounded to greater than 2% last 12 months. It probably hit the identical level in the primary nine months of this 12 months, though the shortage of official data on account of the recent US government shutdown makes this unimaginable to verify.
It’s unimaginable to inform, though, how durable this rebound will likely be or how much could be attributed to AI. The results of latest technologies are seldom felt in isolation. As a substitute, the advantages compound. AI is riding earlier investments in cloud and mobile computing. In the identical way, the newest AI boom may only be the precursor to breakthroughs in fields which have a wider impact on the economy, akin to robotics. ChatGPT might need caught the favored imagination, but OpenAI’s chatbot is unlikely to have the ultimate word.
David Rotman replies:Â
That is my favorite discussion today in terms of artificial intelligence. How will AI affect overall economic productivity? Forget concerning the mesmerizing videos, the promise of companionship, and the prospect of agents to do tedious on a regular basis tasks—the underside line will likely be whether AI can grow the economy, and meaning increasing productivity.Â
But, as you say, it’s hard to pin down just how AI is affecting such growth or how it would accomplish that in the long run. Erik Brynjolfsson predicts that, like other so-called general purpose technologies, AI will follow a J curve through which initially there’s a slow, even negative, effect on productivity as firms invest heavily within the technology before finally reaping the rewards. After which the boom.Â
But there’s a counterexample undermining the just-be-patient argument. Productivity growth from IT picked up within the mid-Nineties but because the mid-2000s has been relatively dismal. Despite smartphones and social media and apps like Slack and Uber, digital technologies have done little to supply robust economic growth. A powerful productivity boost never got here.
