According to Morgan Stanley, the future of artificial intelligence may have significant effects on the labor economy.
By changing input costs, automating jobs, and altering how businesses receive, process, and analyze information, analyst Brian Nowak predicts that AI technology will have a $4.1 trillion economic impact on the labor force — or affect nearly 44% of labor — over the next several years. According to Morgan Stanley, the impact of AI will cost $2.1 trillion and affect 25% of the workforce.
“We see generative AI expanding the scope of business processes that can be automated,” he wrote in a note on Sunday. “At the same time, the input costs supporting GenAI capability are declining quickly, allowing software production to expand significantly. Generative AI is therefore expected to have an effect on labor markets, increase the TAM for corporate software, and stimulate more spending on public cloud services.
The Morgan Stanley predictions coincide with a spectacular 2023 for equities associated with artificial intelligence. Even though some closely connected technology stocks have declined recently, many investors are still optimistic about the sector’s prospects in the long run.
As a result of the adoption of AI, Morgan Stanley predicts that software suppliers may take home 5% of the $4.1 trillion labor effect, or a total addressable market of $205 billion over the following three years.
According to Morgan Stanley, if generative AI adoption among enterprise workloads reaches 20% over the next three years, there will be a $150 billion opportunity for worldwide enterprise investment.
