AI-driven productivity gains are being held up by fear and skills gaps

Despite the potential for artificial intelligence (AI) to revolutionize the workplace and drive significant productivity gains, many organizations are struggling to integrate the technology into their operations. A recent survey by Pearl Meyer found that while some companies are actively making leadership decisions and communicating with employees about the impact of AI, others are taking a more cautious approach or have yet to evaluate the technology at all. This hesitation is understandable, given the transformative potential of AI and the need for careful change management strategies.

The delayed impact of AI on productivity is not unique, as historical examples like the introduction of electricity and personal computers demonstrate that it can take years or even decades for the full benefits of new technologies to be realized. However, some experts believe that the impact of AI may be felt more quickly due to the existing infrastructure and the ease of access for end-users. Nevertheless, significant investments in technology and human capital will still be required, and it remains to be seen whether the productivity gains will be as dramatic as some predict.

At the company level, studies have shown that AI adoption can lead to substantial improvements in worker productivity, particularly for low-skilled workers. However, factors such as cybersecurity risks, political disruptions, and energy shortages may limit the overall productivity gains. As a result, while AI is expected to drive productivity growth in the coming years, the incremental effect may be more modest than some anticipate, perhaps in the range of 0.1 to 0.5 percentage points annually.

To fully harness the productive potential of AI, organizations must upgrade their human users first with investment in upskilling and reskilling their workforce. A consortium led by major technology companies has pledged to train nearly 100 million workers over the next decade to mitigate the disruptive impact of AI on the job market. Additionally, employers are increasingly turning to contingent workers with AI expertise to spread understanding throughout their organizations.

By prioritizing AI literacy and providing learning and development opportunities, companies can build a more agile and innovative workforce capable of thriving in the era of AI. However, overcoming the fear and uncertainty surrounding this transformative technology will be crucial to unlocking its full potential for productivity growth.