Every dollar spent on AI will generate 4.60 Towards the global economy
NEEDHAM, Mass., September 17, 2024 – A new IDC study titled, The global impact of artificial intelligence on the economy and employmentpredicts that business spending to adopt artificial intelligence (AI), use AI in existing business operations, and deliver better products/services to businesses and consumers will have a cumulative global economic impact of $19.9 trillion by 2030 and generate 3.5% of global GDP in 2030. As a result, AI will impact employment in every region of the world, affecting industries such as contact center operations, translation, accounting, and machine inspection. Business leaders are helping to drive this change by almost unanimously, 98%, considering AI a priority for their organizations.
AI‘s Net positive global economic impact
According to the study, by 2030, every new dollar invested in business-related AI solutions and services will generate $4.60 in the global economy, in terms of indirect and induced effects. This is determined by:
- Increased spending on AI solutions and services driven by accelerated AI adoption
- Economic stimulus among AI adopters, seeing benefits in terms of increased production and new revenue streams
- Impact across the entire AI vendor supply chain, increasing revenue from suppliers of critical supplies to AI solution and service providers
“In 2024, AI has entered a phase of accelerated development and deployment defined by widespread integration that has led to increased investments by companies aimed at significantly optimizing operational costs and time to market,” said Lapo FiorettiSenior Research Analyst, Emerging Technologies and Macroeconomics, IDC. “By automating routine tasks and enabling new efficiencies, AI will have profound economic consequences, reshaping industries, creating new markets, and changing the competitive landscape.”
Impact on employment: new roles emerge while others remain resilient
The majority of IDC respondents Future of Work Employee Survey expect some (48%) or most (15%) parts of their jobs to be automated by AI and other technologies in the next two years, while only a minority (3%) of employees expect their jobs to be fully automated by AI.
While some occupations will be negatively impacted by the proliferation of AI, new positions such as AI ethicists and AI engineers will emerge as dedicated roles within global organizations.
The study also indicates that the intensity of human contact, combined with the level of “task repetitiveness” that characterizes each role, will allow organizations to determine which roles will be entirely replaced by AI and automation, versus those where the role of technology will be to augment human capabilities. For example, roles where human social and emotional capabilities are essential, such as nursing, and roles where decision-making encompasses ethics and understanding beyond the numbers, will remain strong.
“We’re all curious about whether AI will replace our jobs,” said Rick Villars, vice president of IDC’s Worldwide Research Group. “As one CEO interviewed by IDC’s Andrea Siviero said, “It’s clear from this study that we should be asking ourselves how AI can make our jobs easier and better. AI won’t replace your job, but someone who knows how to use it better than you will.”
Research methodology
To estimate the overall economic impact of a technology or service, IDC has developed an economic impact methodology that combines IDC’s market knowledge and internal data with a standard analytical framework, known as an economic impact analysis. It is based on an input-output (I/O) framework, using the most recent official input-output tables for a specific economy: using the I/O tables, specific multipliers are determined and applied to specific technologies to calculate the associated effect. This IDC economic impact analysis assesses three types of impact on the economy. In this AI-specific model, these are:
● Direct effect – includes revenue from commercial AI solution/service providers selling their products directly to end users.
● Indirect effect – refers to the economic impact related to the AI supply chain and the benefits for AI adopters. It includes the effects that organizations/technology providers have on the region or country due to their operations related to the provision of AI.
○ Indirect back Impacts refer to the economic effects on supply chains and industries that provide inputs to AI-driven sectors — in other words, the revenues generated in local industries impacted by AI.
○ Indirect forward Impacts refer to the effects on AI adopters, excluding consumers, who benefit from the adoption of AI technology, in terms of productivity, revenue growth, and other business metrics.
● Induced effect – these are the effects induced by the increase in production. This is the impact, due to the economic recovery, of an increase in household income, including existing and new employees linked to the AI value chain through the layers of direct and indirect effects. People will spend part of their salary in the economy, thus generating an additional economic impact.
“The importance of economic impact models is growing. This type of analysis can be important for any supplier that wants to understand the impact of its specific products or services in the short or medium term. It helps not only businesses, but also governments and other stakeholders to make informed decisions by assessing the potential benefits of a technology investment, for example, for the economy,” said Carla La CroceResearch Manager, Data and Analytics, IDC.
The IDC report, The global impact of artificial intelligence on the economy and employment: AI will drive 3.5% of GDP by 2030 (Doc #US51057924), assesses the impact of artificial intelligence on economic output and employment. This assessment draws on IDC’s market knowledge and internal data, as well as IDC’s Economic Impact Model, which considers the direct, indirect, and induced effects of AI on the economy. The study examines the global impact of AI on the economy, focusing on specific regions, technology layers, and sectors. The goal is to assess the cumulative contributions of AI to the economy relative to projected global GDP in 2030.
About IDC
International Data Corporation (IDC) is the world’s leading provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,300 analysts worldwide, IDC provides global, regional, and local expertise on technology, IT benchmarking and sourcing, as well as industry opportunities and trends in more than 110 countries. IDC’s analysis and insights help IT professionals, business executives, and the investment community make fact-based technology decisions and achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the global leader in technology, data and marketing services. For more information about IDC, visit www.idc.comFollow IDC on Twitter at @IDC And LinkedIn. Subscribe to the IDC Blog for industry news and information.
