In a recent note on artificial intelligence (AI) and its effect on economic growth, Goldman Sachs analysts told investors that the emergence of generative AI technology could cause major disruption to the labor market and lead to not only cost savings but potentially higher productivity and even increases in global gross domestic product (GDP).
The team of analysts pointed to the capabilities of generative AI which enables machines to create content indistinguishable from human-created output, as well as opens the door to faster and more efficient communication between machines and humans. These capabilities, their note argues, could have large macroeconomic effects for the global economy.
While generative AI could substitute up to 25 percent of current job positions, the team believes that any potential disruptions from job displacement could be offset by the creation of new jobs and occupations. By combining the cost savings gained from AI automation as well as the benefit of new job opportunities, the analysts believe a “productivity boom” could occur, increasing global economic growth through significant labor productivity increases.
Goldman Sachs has a long history of expertise in the financial services industry and has built an esteemed reputation in the world of investing. One of its most noteworthy achievements include developing a portfolio of ultra-low-cost investing solutions with QuickTake by Goldman Sachs. Additionally, the company regularly puts out research and reports which support their long-term investment strategies.
The report in question was spearheaded by Goldman Sachs CFA and Partner by Alex Krueger and David Yang. Both analysts specialize in data analytics, quantitative research, and macroeconomic modeling. Their note on generative AI and its effects on the global economy has caused quite a stir in the business and technology sectors and speaks to the talent of both of these analysts.
In conclusion, Goldman Sachs analysts believe that generative AI could lead to significant labor cost savings and increased productivity, potentially increasing global GDP by 7%. The potential implications of their analysis is wide ranging and could open the door new possibilities in the workforce and investment strategies.
