How much is generative artificial intelligence worth? potential impact of $4.4 trillion

How much is generative artificial intelligence worth?  potential impact of $4.4 trillion


The potential effects on the economy, the impacts on the world of work, the changes it will induce in society: the discussion around chatbots powered by generative artificial intelligence and large format language models is daily and everything suggests that it will intensify further over the next few months and years. We know the issues on the table and they feed two opposing parties, those who see technology as an ally and those who fear its pervasive diffusion.
The companies and the managers who lead them are close to a crossroads that requires a decisive decision on how to ride and make this umpteenth revolution their own and the very recent approval of the AI ​​Act by the European Parliament (whose entry into force is scheduled for 2024 ) is in fact a confirmation that the time available to companies to rethink processes, organizations and skills is not much. On the contrary. A recent study by McKinsey (“The economic potential of generative AI”) tried to shed light on the long-term consequences that these new generation tools will have on the global economy, examining about 2,100 specific professional activities in about 50 countries that they account for more than 80% of the global workforce.

Gen AI as UK GDP

The figure that emerges from the report drawn up by the American consulting firm is one of those to be circled in red: the contribution that GenAI could in fact make to the global economy can be estimated in a range between 2.6 and 4.4 trillion dollars per year. year, a figure that represents the gross domestic product of a country like the United Kingdom (whose value of production in 2021 stood at 3.1 trillion dollars). Compared to previous estimates by McKinsey itself, reads an article commenting on the study that appeared in the New York Times, the impact of the algorithm economy is drastically higher, rising from the 15% estimated in 2017 to 40% in the most recent assessment. The reason for the very strong acceleration, as the analysts explain, is easily understood and reflects the speed of adoption (“incredibly rapid”) of ChatGpt and the like (the search engine Bing from Microsoft, Bard from Google or Ernie from the Chinese Internet giant Baidu ) by the general public and the wide range of potential applications regarding the corporate world, including small businesses. According to experts, most of the economic value induced by GenAI will probably come from the possibility of automating customer management activities (about half of the customer contacts of banking and telecom companies in North America are already managed by bots and automated systems ), marketing and sales processes and greater productivity in the field of software engineering (for the generation of initial drafts of code, the correction and the so-called “refactoring” of the code itself) and research and development, an area in which the Generative AI will help planners and designers reduce costs by selecting and using materials more efficiently. In general, McKinsey considers the new frontier of algorithms as a “technological catalyst”, capable of pushing industries towards automation and unleashing the creative potential of workers, and as such will require much more leadership than technology, also at the level of regulatory authorities.

The impact on work and the difference with the “old” AI

The other front of McKinsey’s investigation, whose half of the overall workforce uses these technologies on an ongoing basis, is dedicated to the impact of generative artificial intelligence on the professions. Well, all of these tools according to experts have the potential to automate work activities that today consume 60-70% of employees’ time on a global basis. However, the risk that this incidence could mean a massive loss of jobs is reduced (at least in part) by Alex Sukharevsky, senior partner of QuantumBlack (McKinsey’s internal AI division) and co-author of the report. The key point, the manager underlined in a statement taken from the VentureBeat online portal, is to make the execution of certain functions significantly faster and much more precise, adding up to three percentage points of additional growth to the productivity of the entire economy global. In other words, as the report continues, generative AI has the potential to change the anatomy of work and at the same time create the conditions for a more sustainable and inclusive world, but it will be essential to learn new skills and become aware of the fact that many people will change occupations. Furthermore, according to the manager, a dutiful distinction must be made between generative AI and large-scale linguistic models (LLM) and conventional artificial intelligence and robotics technologies: the former will constitute the breaking point for the so-called “knowledge workers” ” while the latter will remain focused on more physical tasks such as industrial production, construction, plant engineering and transport, with even substantially different impact times. In any case, the scenario forecast for the coming decades is symptomatic of the very strong change that will take place in the workplace: half of today’s activities are destined to be fully automated or nearly so between 2030 and 2060, with an intermediate point set at 2045, that is, about a decade earlier than McKinsey predicted just a few years ago. Any conclusions about the effects of technology, as he recently warned. However, David Autor, professor of economics at MIT in Boston, could be premature: generative artificial intelligence, this is precisely his story, “probably won’t be as miraculous as they say, and today we are really in the initial stage of its development”.

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