The question of AI’s role in shifting work is difficult to answer confidently with so much we don't know and how quickly the technology is evolving. But there’s a steady flow of research examining how AI is changing workplaces that’s vitally useful.
The latest is McKinsey’s new report, “The economic potential of generative AI,” released earlier this week. Here are key takeaways for thinking and planning for yourself, your team, and your organization:
- About 75% of the potential value from generative AI is in four areas (page 12 of the full McKinsey report has a useful graphic about the potential benefits from generative AI by business function):
- About 60-70% of workers’ time is spent on activities that could potentially be automated by current generative AI and other technology. This is up from 2017, when McKinsey had estimated that technology could automate half of worker hours worldwide.
- It expects that half of today’s work activities will be automated between 2030 and 2060, a faster timeline than earlier estimated.
- Banking, technology, and life sciences are the industries that could see the biggest revenue boosts from generative AI.
- Generative AI could have a major impact in areas such as managing, applying expertise, and interfacing with stakeholders. McKinsey’s estimate of the automation potential for management, for example, jumped to 49% from 16% as a result of the rise of generative AI. “Many of the work activities that involve communication, supervision, documentation, and interacting with people in general have the potential to be automated by generative AI, accelerating the transformation of work in occupations such as education and technology, for which automation potential was previously expected to emerge later,” the authors write. (A chart on page 41 of the report breaks this down by specific professions.)
- Generative AI can automate the work of some of the most educated workers, unlike traditional automation, which tends to most impact those with the lowest skills. McKinsey’s models show the biggest relative jump in automation potential for roles requiring graduate degrees as a result of generative AI.
The McKinsey analysis is roughly in line with other recent research, including a March Goldman Sachs report, which found that “roughly two-thirds of current jobs are exposed to some degree of AI automation, and that generative AI could substitute up to one-fourth of current work.”
Another recent AI & work research finding worth knowing about:
- “AI investments are associated with a flattening of the firms' hierarchical structure, with significant increases in the share of workers at the junior level and decreases in shares of workers in middle-management and senior roles.” —June 2023 National Bureau of Economic Research working paper, “Firm Investments in Artificial Intelligence Technologies and Changes in Workforce Composition”
Download Charter’s new strategy briefing memo, “The AI Mandate for HR,” to read our seven frameworks for how people leaders can play a central role in AI’s adoption.