Generative AI could add as much as $4.4 trillion annually to the global economy and will transform productivity across sectors with continued investment in the technology, according to a new study.
The higher end of $2.6 trillion to $4.4 trillion annual economic contribution range of generative AI eclipses the entire gross domestic product of the UK that reached $3.1 trillion in 2021, consultancy McKinsey said in its report The Economic Potential of Generative AI: The Next Productivity Frontier.
Generative AI is estimated to add 15 per cent to 40 per cent to the $11 trillion to $17.7 trillion of economic value that McKinsey estimate non-generative artificial intelligence and analytics could unlock.
The latest estimate is an upgrade from 2017 when the consultancy estimated AI to deliver $9.5 trillion to $15.4 trillion in economic value.
“About 75 per cent of the value that generative AI use cases could deliver falls across four areas: customer operations, marketing and sales, software engineering, and research and development,” McKinsey analysts said in the report.
Generative artificial intelligence is a type of AI system that can generate text, images, or other media. These models use neural networks to identify patterns and structures within existing data to generate new and original content.
Researchers examined 63 use cases across 16 business functions in which the technology can address specific business challenges in ways that produce one or more measurable outcomes.
“Examples include generative AI’s ability to support interactions with customers, generate creative content for marketing and sales and draft computer code based on natural-language prompts, among many other tasks,” the report said.
The sudden emergence of AI chatbot ChatGPT and other tools have jump-started investment in the AI sector. More than $2 billion worth of investments were made in generative AI sector in 110 deals in 2022 alone, according to Goldman Sachs.
The US investment bank estimates that 25 per cent of current work tasks could be automated by AI in the US and Europe alone, with traditionally high-skill, non-routine jobs such as legal and financial operations highly susceptible to automation.
While the rapid evolution of AI is expected to automate tasks and boost productivity, experts warn of numerous risks, putting pressure on governments and regulators to accelerate the pace of legislation to match the pace of the industry’s development.
This month, US President Joe Biden meet industry leaders to discuss the “risks and enormous promises” of artificial intelligence.
Ahead of the meeting, major AI companies, including Microsoft and Alphabet’s Google, committed to participating in the independent public evaluation of their systems.
There is a wide range of estimates available on generative AI’s economic potential as the industry continues to evolve.
In April, Goldman Sachs said the sector could drive a 7 per cent – or almost $7 trillion – increase in global GDP and lift productivity growth by 1.5 percentage points over a 10-year period.
“Despite significant uncertainty around the potential for generative AI, its ability to generate content that is indistinguishable from human-created output and to break down communication barriers between humans and machines reflects a major advancement with potentially large macroeconomic effects,” Goldman Sachs economists Joseph Briggs and Devesh Kodnani wrote in a report.
Across the banking industry, for example, the technology could deliver value equal to an additional $200 billion to $340 billion annually if the use cases were fully implemented
McKinsey report says
Though generative AI will have a significant impact across all industry sectors, banking, high tech and life sciences are among the industries that could see the biggest impact on percentage of their revenues from generative AI, McKinsey said.
“Across the banking industry, for example, the technology could deliver value equal to an additional $200 billion to $340 billion annually if the use cases were fully implemented,” the consultancy said.
“In retail and consumer packaged goods, the potential impact is also significant at $400 billion to $660 billion a year.”
The rapid development of generative AI also has the potential to “change the anatomy of work” and can automate work activities that absorb 60 to 70 per cent of employees’ time today.
It can also substantially increase labour productivity across the global economy, but that will require continued investments, the report said.
Generative AI could increase productivity growth by 0.1 to 0.6 per cent annually through 2040, depending on the rate of technology adoption and redeployment of worker time into other activities.
“The era of generative AI is just beginning. Excitement over this technology is palpable, and early pilots are compelling,” the McKinsey report said.
“But a full realisation of the technology’s benefits will take time, and leaders in business and society still have considerable challenges to address.”
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
Indoor Cricket World Cup
Venue Insportz, Dubai, September 16-23
UAE squad Saqib Nazir (captain), Aaqib Malik, Fahad Al Hashmi, Isuru Umesh, Nadir Hussain, Sachin Talwar, Nashwan Nasir, Prashath Kumara, Ramveer Rai, Sameer Nayyak, Umar Shah, Vikrant Shetty
MATCH INFO
Scotland 59 (Tries: Hastings (2), G Horne (3), Turner, Seymour, Barclay, Kinghorn, McInally; Cons: Hastings 8)
Russia 0
Brief scores:
Arsenal 4
Xhaka 25', Lacazette 55', Ramsey 79', Aubameyang 83'
Fulham 1
Kamara 69'
More coverage from the Future Forum
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Brief scores:
Toss: Northern Warriors, elected to field first
Bengal Tigers 130-1 (10 ov)
Roy 60 not out, Rutherford 47 not out
Northern Warriors 94-7 (10 ov)
Simmons 44; Yamin 4-4
Liverpool 4-1 Shrewsbury
Liverpool
Gordon (34'), Fabinho (44' pen, 90' 3), Firmino (78')
Shrewsbury
Udoh (27'minutes)
Man of the Match: Kaide Gordon (Liverpool)
What it means to be a conservationist
Who is Enric Sala?
Enric Sala is an expert on marine conservation and is currently the National Geographic Society's Explorer-in-Residence. His love of the sea started with his childhood in Spain, inspired by the example of the legendary diver Jacques Cousteau. He has been a university professor of Oceanography in the US, as well as working at the Spanish National Council for Scientific Research and is a member of the World Economic Forum’s Global Future Council on Biodiversity and the Bio-Economy. He has dedicated his life to protecting life in the oceans. Enric describes himself as a flexitarian who only eats meat occasionally.
What is biodiversity?
According to the United Nations Environment Programme, all life on earth – including in its forests and oceans – forms a “rich tapestry of interconnecting and interdependent forces”. Biodiversity on earth today is the product of four billion years of evolution and consists of many millions of distinct biological species. The term ‘biodiversity’ is relatively new, popularised since the 1980s and coinciding with an understanding of the growing threats to the natural world including habitat loss, pollution and climate change. The loss of biodiversity itself is dangerous because it contributes to clean, consistent water flows, food security, protection from floods and storms and a stable climate. The natural world can be an ally in combating global climate change but to do so it must be protected. Nations are working to achieve this, including setting targets to be reached by 2020 for the protection of the natural state of 17 per cent of the land and 10 per cent of the oceans. However, these are well short of what is needed, according to experts, with half the land needed to be in a natural state to help avert disaster.
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Padmaavat
Director: Sanjay Leela Bhansali
Starring: Ranveer Singh, Deepika Padukone, Shahid Kapoor, Jim Sarbh
3.5/5
Five%20calorie-packed%20Ramadan%20drinks
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EPL's youngest
- Ethan Nwaneri (Arsenal)
15 years, 181 days old
- Max Dowman (Arsenal)
15 years, 235 days old
- Jeremy Monga (Leicester)
15 years, 271 days old
- Harvey Elliott (Fulham)
16 years, 30 days old
- Matthew Briggs (Fulham)
16 years, 68 days old
Afghanistan squad
Gulbadin Naib (captain), Mohammad Shahzad (wicketkeeper), Noor Ali Zadran, Hazratullah Zazai, Rahmat Shah, Asghar Afghan, Hashmatullah Shahidi, Najibullah Zadran, Samiullah Shinwari, Mohammad Nabi, Rashid Khan, Dawlat Zadran, Aftab Alam, Hamid Hassan, Mujeeb Ur Rahman.
COMPANY%20PROFILE
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You Were Never Really Here
Director: Lynne Ramsay
Starring: Joaquim Phoenix, Ekaterina Samsonov
Four stars
PROFILE OF HALAN
Started: November 2017
Founders: Mounir Nakhla, Ahmed Mohsen and Mohamed Aboulnaga
Based: Cairo, Egypt
Sector: transport and logistics
Size: 150 employees
Investment: approximately $8 million
Investors include: Singapore’s Battery Road Digital Holdings, Egypt’s Algebra Ventures, Uber co-founder and former CTO Oscar Salazar
The%20Genius%20of%20Their%20Age
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Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
RIVER%20SPIRIT
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UAE currency: the story behind the money in your pockets
The specs
Engine: 3.8-litre V6
Power: 295hp at 6,000rpm
Torque: 355Nm at 5,200rpm
Transmission: 8-speed auto
Fuel consumption: 10.7L/100km
Price: Dh179,999-plus
On sale: now
Tewellah by Nawal Zoghbi is out now.
STAGE 4 RESULTS
1 Sam Bennett (IRL) Deceuninck-QuickStep - 4:51:51
2 David Dekker (NED) Team Jumbo-Visma
3 Caleb Ewan (AUS) Lotto Soudal
4 Elia Viviani (ITA) Cofidis
5 Matteo Moschetti (ITA) Trek-Segafredo
General Classification
1 Tadej Pogacar (SLO) UAE Team Emirates - 12:50:21
2 Adam Yates (GBR) Teamn Ineos Grenadiers - 0:00:43
3 Joao Almeida (POR) Deceuninck-QuickStep - 0:01:03
4 Chris Harper (AUS) Jumbo-Visma - 0:01:43
5 Neilson Powless (USA) EF Education-Nippo - 0:01:45
