Generative AI could raise global GDP by 7%

Generative AI could raise global GDP by 7%

As tools built on generative AI work their way into businesses and society, they have the scope to drive a 7% (or almost $7 trillion) increase in global GDP and lift productivity growth by 1.5 percentage points over a 10-year period, according to Goldman Sachs Research. But shifts in workflows triggered by these advances could also expose the equivalent of 300 million full-time jobs to automation, Goldman Sachs economists Joseph Briggs and Devesh Kodnani write in a report.

Our economists estimate that roughly two-thirds of U.S. occupations are exposed to some degree of automation by AI. They further estimate that for those occupations that are exposed, roughly a quarter to as much as half of their workload could be replaced.

But not all that automated work will translate into layoffs, the report says. “Although the impact of AI on the labor market is likely to be significant, most jobs and industries are only partially exposed to automation and are thus more likely to be complemented rather than substituted by AI,” the authors write. They note that jobs displaced by automation have historically been offset by the creation of new jobs, and the emergence of new occupations following technological innovations accounts for the vast majority of long-term employment growth.

Advances in AI are expected to have a far-reaching effect on the global enterprise software, healthcare and financial services industries, Kash Rangan, senior U.S. software analyst in Goldman Sachs Research, writes in a separate report. Added up, GS Research estimates the total addressable market for generative AI software to be $150 billion, compared with $685 billion for the global software industry.