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\t\t\tIllustration by Tag Hartman-Simkins \/ Futurism. Source: Getty Images<\/p>\n
While AI companies continue to command the global economy and pour billions of dollars into building data centers, it\u2019s still not even clear that their products can deliver on one of their core premises: increasing productivity.<\/p>\n
One big skeptic of the tech\u2019s economic promises is vice president and principal analyst at the global market analytics firm JP Gownder, who says we\u2019re simply \u201cnot seeing\u201d an AI-driven boost to productivity in any of the available data.<\/p>\n
\u201cYou begin to get the picture that information technology isn\u2019t measured always in as linear a way into productivity as people assume,\u201d he told The Register in a new interview<\/a>. \u201cIt just isn\u2019t there.\u201d<\/p>\n This isn\u2019t a statement on how transformative AI might or might not be. It could have massive effects without necessarily translating to economic gains, a phenomenon known as the Solow Paradox, named after the Nobel Prize winning economist Robert Solow who correctly predicted \u201cthat by 1987 the effects of the PC revolution can be seen everywhere, except in the productivity statistics,\u201d in Gownder\u2019s analysis.<\/p>\n He pointed to data from the US Bureau of Labor Statistics showing how between 1947 to 1973 \u2014 before the advent of PCS \u2014 productivity improved by 2.7 percent annually, but only 2.1 percent between 1990 and 2001, once PCs had hit the mainstream.<\/p>\n \u201cSo despite all those PCs, it was a lot lower,\u201d Gownder said. \u201cAnd [from] 2007 to 2019 it was 1.5 percent.\u201d<\/p>\n Mountains of research as well as cases of workplace deployment of AI have suggested that the tech is far from being ready for primetime. One notable MIT study<\/a> found that 95 percent of companies that integrated AI saw zero meaningful growth in revenue. For coding tasks, one of AI\u2019s most widely hyped applications, another study showed<\/a> that programmers who used AI coding tools actually became slower at their jobs.\u00a0<\/p>\n AIs designed to automate entire tasks aren\u2019t looking too hot either: when researchers at the Center for AI Safety tested AI agents\u2019 ability to complete remote work tasks<\/a>, not a single model was able to complete more than three percent of their assignments. The very introduction of AI into the workplace appears to be disastrous for employee relations, suggests another study<\/a>, which found that AI resulted in employees passing off low quality \u201cworkslop\u201d with the expectation that someone else down the line would polish the AI\u2019s shoddy output.<\/p>\n \u201cA lot of generative AI stuff isn\u2019t really working,\u201d Gownder told The Register. \u201cAnd I\u2019m not just talking about your consumer experience, which has its own gaps, but the MIT study that suggested that 95 percent of all generative AI projects are not yielding a tangible [profit and loss] benefit. So no actual [return on investment.]\u201d<\/p>\n \u201cIt is just further context that says we\u2019re not at a place where lots and lots of people are losing their jobs right now,\u201d he added.<\/p>\n That said, Forrester\u2019s research does predict that AI and other automation tech, like physical robots, will see a hefty six percent of jobs replaced by 2030, amounting to some 10.4 million roles.<\/p>\n \u201cThese jobs are lost structurally, like they\u2019re gone for good, because they\u2019ve been replaced,\u201d Gownder told The Register. \u201cThat\u2019s not an insignificant hit to the economy.\u201d<\/p>\n There may come a point where employers realize that AI isn\u2019t working out, Gownder said. Some bosses who fired workers in favor of AI agents have already eaten crow and rehired their human grunts<\/a>. But \u201cAI\u201d may simply be a way of papering over other forms of cost-cutting.<\/p>\n \u201cOutsourcing is a very popular one,\u201d he told The Register. \u201cThey\u2019re firing people because of AI, and then three weeks later they hire a team in India because the labor is so much cheaper.\u201d<\/p>\n