This would represent an increase of 15 to 40 percent in the overall impact of artificial intelligence. Furthermore, if generative AI is embedded into existing software beyond these use cases, the estimated value could double.

Approximately 75 percent of the value from generative AI is expected to come from four key areas: customer operations, marketing and sales, software engineering, and research and development. In the banking industry, for instance, generative AI could deliver an additional $200 billion to $340 billion annually. Retail and consumer packaged goods sectors could see an impact of $400 billion to $660 billion per year.

Generative AI can significantly impact productivity by automating work activities. It has the potential to automate tasks that currently consume 60 to 70 percent of employees’ time. This is a substantial increase from previous estimates and is attributed to generative AI’s improved understanding of natural language. Knowledge-based work that requires higher wages and educational qualifications is expected to be most affected by generative AI.

The pace of workforce transformation is projected to accelerate. Estimates suggest that between 2030 and 2060, around half of today’s work activities could be automated, a decade earlier than previously anticipated. Generative AI alone could increase labor productivity by 0.1 to 0.6 percent annually through 2040. When combined with other technologies, work automation could contribute an additional 0.2 to 3.3 percentage points to overall productivity growth.

To successfully implement generative AI, investments are needed to support workers during transitions and skill development. While generative AI can enhance productivity and contribute to economic growth, managing worker transitions and mitigating associated risks is essential. This includes providing support for learning new skills and potentially changing occupations.

It is important to note that although generative AI is an exciting technology, traditional AI applications still dominate in terms of overall value potential. Generative AI focuses on creativity and innovation, expanding the possibilities of AI. However, it is crucial to manage risks, determine necessary skills, and rethink business processes to fully realize its benefits.

Generative AI can revolutionize internal knowledge management systems by allowing employees to access relevant information more efficiently. This can lead to better-informed decision-making and more effective strategies. Additionally, generative AI can work in partnership with workers, accelerating productivity and enabling them to focus on higher-impact tasks. For example, it can serve as a virtual expert in generating creative content and providing insights, as well as act as a virtual collaborator to facilitate collaboration and speed up product development.

In summary, generative AI has the potential to significantly impact the global economy, with estimates of annual value ranging from $2.6 trillion to $4.4 trillion. It can automate work activities, particularly in knowledge-based occupations, and increase labor productivity. However, successful implementation requires supporting workers through transitions and skill development. While generative AI expands the possibilities of AI, traditional AI applications still hold the majority of value potential. Managing risks, determining necessary skills, and rethinking business processes are crucial for realizing the full benefits of generative AI.