The hype and excitement of AI is being felt across everyday lives today, but its very real economic impact has only just begun. According to BNY Mellon’s Global Economics and Investment Analysis (GEIA) team, widespread AI adoption may result in a more than 1.5% rise in global productivity growth in the next decade.
In analysing the AI movement, GEIA economists Jake Jolly and Seb Vismara explored its market and economic impact, outlining in their view probable scenarios. One headline assertion in their analysis is the likelihood of its substantial impact on productivity growth. This in turn could have a positive influence on earnings growth and operating margins, given they are typically correlated to productivity growth (a key driver of GDP growth), the two say.
“Generative AI could potentially spur a new industrial revolution as it can automate and augment many non-routine tasks less impacted by previous innovations.1 Like the steam engine, electrification and computers, AI could fundamentally reshape industrial organisation and work.”