GenAI productivity gains will skew towards services
Productivity gains from the use of Generative AI (GenAI) and other similar technological advancements are set to boost medium-term economic growth, but the gains will be spread unevenly across sectors and skew towards the services side of the economy.
Oxford Economics has quantified an ordinal measure of sectoral GenAI exposure, indexed on a scale of 0 to 1. The index is constructed so that a higher number represents greater potential for GenAI-driven productivity and output gains.
What you will learn:
- Gains will take the form of automation or augmentation of tasks, either replacing the need for human labour or making it more effective. We find services sectors like information, financial services, and R&D have substantial potential for productivity gains.
- The speed and extent of AI adoption will vary across sectors. Sectors taking the lead with early adoption, such as information and finance, are among those we expect to experience the largest productivity gains and have a higher share of start-ups and large firms.
- In the near term, the rollout and adoption of GenAI technology will have positive impact on demand for enterprise software, computational power and storage, communication links, and internet. Growth in global enterprise tech spend will be over twice the pace of overall GDP. This will support continued rapid growth in the construction of data centres, which will in turn boost demand for semiconductors and electricity.
Tags:
Related Resources
Post
Australia’s Infrastructure Outlook: Big Shifts, Bigger Challenges
Australia’s infrastructure landscape is shifting fast, driven by new investment trends, emerging asset classes and growing capacity constraints. This outlook explores the major changes ahead and what industry and government must do to navigate the decade effectively.
Find Out More
Post
China and AI underpin stronger global trade outlook
Global trade is set for a stronger-than-expected rebound, supported by lower US tariffs, continued AI-driven investment, and China’s renewed export push. Our latest forecasts show upgrades to both nominal and volume trade growth in 2025–26, even as legal uncertainty surrounding US tariff mechanisms and evolving geopolitical dynamics pose risks to the outlook.
Find Out More
Post
Are humanoid robots creepy?
Some very smart people are betting that machines shaped like humans will do much of our household and factory work for us in the near-ish future. But hurdles remain.
Find Out More
Post
How can tax and finance leaders build agile functions that thrive?
Building continuous transformation into tax and finance functions can equip them to use AI, adding rich, deep insight and value to businesses.
Find Out More
