AI is driving a technological revolution that is – and will continue to – affect every element of our society, and the investment environment is reflecting this, with more than $110 billion invested in PE (private equity) in 2024. As the adoption of the technology increases, it’s set to have a major impact on the global workforce and overarching productivity.
A Shifting Workforce
As the use of ever more sophisticated AI agents grows, this will necessarily change the face of the general workforce. Although, to date, artificial intelligence has been primarily used to undertake and automate repetitive tasks, it’s almost inevitable that it will be increasingly used for more complex tasks as the technology continues to develop. This, in turn, may disrupt the skilled labour force. While some experts fear this will place skilled roles under threat, others posit that AI could enhance employment roles by taking care of mundane tasks so employees can focus on more meaningful, engaging work.
Effects on Productivity
There is currently an intense debate around the potential productivity gains that come from using AI and, in connection with this, how productivity itself can be effectively measured. While productivity is traditionally improved by increasing ‘value add’ and fostering growth, AI introduces a new element to the equation with the phasing out of administrative, repetitive tasks. Furthermore, AI tools may result in an overall improvement in productivity by reducing these menial tasks. While job displacement may occur in the short term as the use of this technology grows, there could be a move towards job creation in the medium to long term as roles adapt and evolve in response to new innovations in this sphere.
Adoption of AI on the Rise
Experts in macroeconomics such as Domen Zavrl understand that, in terms of productivity gains, the adoption of AI by organisations is fundamental. However, measuring this is problematic, as some may use fully integrated AI systems in their main business activities while others use AI tools on an as-needed basis.
There has been an overall decline in the cost to access AI and a steep increase in the adoption of technology, although some experts suggest that there’s likely to be a significant difference in the rate of AI adoption in different countries worldwide. For example, lower rates of AI adoption are expected for countries including Italy, France and Japan, compared to the US, UK, Canada and Germany, according to research published by the OECD in its paper Macroeconomic productivity gains from Artificial Intelligence in G7 economies.
For more information on how AI is anticipated to affect economies of the future, take a look at the embedded PDF.
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