AI's Economic Boost Isn't Showing Up in US GDP, Goldman Says (businessinsider.com) 78
AI is transforming corporate America, yet the boom remains understated in government growth statistics, according to Goldman Sachs. From a report: Analysts at Goldman pointed to the scale of the boom in a Saturday note: "Revenue at US companies providing AI infrastructure has risen by $400 billion since 2022, which at first glance seems to suggest that AI has been a meaningful driver of economic growth recently." But official numbers tell a different story.
AI technology has lifted real US economic activity by about $160 billion since 2022, or 0.7% of GDP, the analysts calculated. Yet only around $45 billion, or 0.2% of GDP, of AI-spurred growth has been recorded in official statistics. That leaves roughly $115 billion uncounted, according to the analysts. That gap highlights the difference between what companies report and what the government measures due to the Commerce Department's Bureau of Economic Analysis method for calculating growth.
AI technology has lifted real US economic activity by about $160 billion since 2022, or 0.7% of GDP, the analysts calculated. Yet only around $45 billion, or 0.2% of GDP, of AI-spurred growth has been recorded in official statistics. That leaves roughly $115 billion uncounted, according to the analysts. That gap highlights the difference between what companies report and what the government measures due to the Commerce Department's Bureau of Economic Analysis method for calculating growth.
Looking in the wrong place (Score:5, Insightful)
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Overall, AI isn't causing all that many job losses, because AI can't be trusted yet(too many AI hallucinations). You hear about all the money these big companies like Microsoft and Oracle are spending on AI, but the majority of companies see potential in AI, but for the most part, AI isn't taking all that many jobs and is seen as a tool by employees to help them do stuff, but isn't replacing that many jobs.
What the AI is really doing (Score:2)
Goofing off at work posting to Slashdot.
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...but for the most part, AI isn't taking all that many jobs and is seen as a tool by employees to help them do stuff, but isn't replacing that many jobs.
We can look at the statistics for jobs that are replaced by AI, but we don't see statistics for the number of jobs that are not being created because AI is being set up to do those jobs rather than hiring someone to fill them. BLS recently issued a correction that the US added 911,000 fewer jobs in 2024 and early 2025 than previously reported, the largest downward revision on record. Without being able to get data from businesses on the reasons for smaller increases in hiring, we can't point to any specifi
Re: Looking in the wrong place (Score:2, Troll)
Re: Looking in the wrong place (Score:2)
People who don't have a job are much more likely to grab a pitchfork and torch when the time comes.
AI is designed to allow wealth to access skill (Score:5, Insightful)
Our current automation trends will reduce the GDP because there will be less overall economic activity. Fewer people with fewer jobs will buy fewer things and use fewer services reducing the GDP.
The way it stands AI, specifically llms, is a fundamentally antisocial technology. It doesn't have to be but context is everything.
You can't have a society where if you don't work you don't eat and then start automating the fuck out of everything.
You can't ingrain at the deepest cultural level the idea that if everyone isn't working a minimum of 40 a week then we need to go after those people because they're stealing from us all and continue automating away jobs.
Something has to give. Either the deeply ingrained notion that people have to work for a living, which is the say if they don't work they die, goes away and we accept that some people are just going to be useless but we're still going to let them have food and shelter and medicine...
Or we have to get okay with those people dying. Either of starvation, the elements or lack of medical Care.
We could also stop the automation Amish style but I don't see us doing that.
I also don't see us handing out food and shelter for free. Nothing pisses off people more than going to work for 40 hours a week and watching somebody sit at home playing Xbox.
I suspect we will take option three which is massive amounts of internal strife leading up to a third world war.
Re:AI is designed to allow wealth to access skill (Score:5, Interesting)
The thing to keep in mind is that the march of technology has always been oriented toward reducing the number of people required to do something. Arguably the single most significant development that led to the modern 'digital age' was Guttenberg's movable type printing press, as it basically took the work of scribes painstakingly rewriting books by hand into new physical volumes and turned it into a process that could mass-produce (for the time period at least) the text of the same works in a fraction of the time with a fraction of the labor.
This had downstream effects on recordkeeping and led to the development of other tools like the typewriter, itself ultimately leading to digital records systems and the modern computing age. At each step along the way, the number of low-level clerks has reduced, and I've seen it firsthand in my own lifetime, where a department's office would have an executive secretary, an administrative secretary, and a receptionist, slowly eliminate to just a single person because so many of the clerical records duties or other secretarial duties were reduced or eliminated by technology.
Now, that said, these tasks were not typically oriented towards decision-making so much as following procedures. That's why these tasks were able to be automated or otherwise condensed or shifted to different personnel, because they were just performing rote steps that were able to be automated. AI could end up being different in that they're now trying to replace creative or conclusion-drawing tasks with it, something that may or may not work out in the end. Right now it's definitely not ready for it, and given how easy it seems to be to poison AI's fundamental dataset, I am left wondering if it ever will be, or if so many jobs will be needed to 'curate' that dataset that it draws upon that in the end it won't really save money. It'll just transfer that money to contractors instead of local staff.
Agreed (Score:1)
Good examples include vaccines keeping people and animals alive and our understanding of agriculture so that we can increase crop yields even with the same labor inputs.
That said as far as automation goes the problem is staying ahead of it.
As automation destroys jobs we need new technology that generates more jobs and we need new social structures for that too.
When the pace of t
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"LLMs" are a red herrring. They are not following physics and show logarithmic gains for exponential computational effort. This is unlike nature, which favours conservation of energy, meaning that (among other things) our brains operating at 25W can outperform any CV the moment we open our eyes. We can also recall words perfectly from a seemingly endless database, as well as perform tasks deterministically.
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On the other hand, our rate of population growth has been dropping so quickly that many people are alarmed. So, the "there aren't enough jobs" problem and the "there aren't enough people" problem seem primed to cancel each other out.
I am sure it won't play out as neatly as that makes it sound. It never does. But after a generation of suffering it looks like it will balance itself out.
Though the "nobody wants to breed anymore" problem is likely to continue and get worse, since none of the root causes are
Re: AI is designed to allow wealth to access skill (Score:2)
Our current automation trends will reduce the GDP because there will be less overall economic activity. Fewer people with fewer jobs will buy fewer things and use fewer services reducing the GDP.
AI has already made just about anyone who knows how to use it vastly richer. You can get (often better) medical diagnosis without taking time off from work, navigate a will and a tax return without having to hire a lawyer, figure out how to structure investments without hiring a financial manager, learn exactly what steps to take and what you need to buy to do a home repair. Have an idea of something to sell? You can offload a lot of figuring out market fit, advertising, business structure, etc. People who
Re: AI is designed to allow wealth to access skill (Score:1)
What if the stock market continues to boom, producing revenue for all, while GDP declines because of overabundance?
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There are literally millions of people doing nothing today [youtube.com], what you are advocating here has already happened, why aren't you happy anyway, is it because it's never enough? AFAIC everyone who can work should be taking care of himself/herself, government must not steal from one to subsidize another, especially in the system basically designed for complete corruption (and it is designed for complete corruption).
It is up to everyone individually to survive on this planet, if there are too many people unable t
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it is what you want to say, not me obviously, stop lying.
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That's the standard Luddite argument.
https://en.wikipedia.org/wiki/... [wikipedia.org]
It was there with the industrial revolution. It was played back with the computer revolution. Now it's AI.
Yes, some people will lose jobs. There will be some disturbance in the labor markets of course. But we adapt.
I understand that this time it feels different, but that is how it felt back then too.
Re: AI is designed to allow wealth to access skill (Score:2)
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You can't have a society where if you don't work you don't eat and then start automating the fuck out of everything.
Correct, YOU can't, but THEY can. All you have to do is stop living and your problems are solved. THEY don't care about your problems. YOU are THEIR problem that they desperately want to get rid of. YOU might band together with others like YOU and bring out the guillotines.
GDP stays the same if you replace a worker with AI (Score:5, Interesting)
GDP is total value of products and services created. If you make the same amount of same things without workers, your GDP stays the same.
AI would increase GDP only if you can sell more of your products because of AI. But finding customers is much harder than automating work.
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GDP is total value of products and services created. If you make the same amount of same things without workers, your GDP stays the same.
GDP is probably not the right measure to look AI's economic impact. There might not be a better one but if you make the same amount of things without workers, very often one of the highest input cost, the market is certain to re-value those things. Fewer dollars will but more of them. Productivity increases without accompanying outlets for increased consumption is deflationary.
Economics is hard because nothing happens in total isolation. A lot of companies have yet to pass on tariff costs. Is AI productiv
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AI boom is very real, but I think currently it mostly focuses on improving science, which means that actual results will be seen after some years. I believe that biggest change will be in medicine when AI starts inventing new medicine for every known decease.
Most likely we will also get a variety of new diagnostic tools. Something that takes a photo of your face and determines that you have heart problems. Or listens to your cough to detect your decease: https://blog.google/technology... [blog.google]
If you don't know th
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Tariffs reducing the potential customer base because of trade wars that don't benefit the population is causing the economy to slow down. People buy less products when tariffs cause the prices to increase, Those in other countries reduce purchases from the USA because of the trade wars, so that hurts the GDP. Trump is a menace to the economy.
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GDP is total value of products and services created. If you make the same amount of same things without workers, your GDP stays the same.
AI would increase GDP only if you can sell more of your products because of AI. But finding customers is much harder than automating work.
Maybe, but that isn’t what seems to be going on with AI.
We don’t get the same “news” publication with AI and zero workers. We get a crappy news publication with one worker and AIs cranking out the same volume of articles as 14 workers, but the articles themselves are crap. They manage to get some level of readership and sell roughly the same ad volume per readership level as a “real” news publication. In theory that should show up on GDP because it is a bunch of re
Did they say the same about the internet? (Score:1)
Since productivity is unobservable, do dismal economists fail to find it rising whenever they don't want to?
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Yes, Paul Krugman famously said in 1998 that the internets economic impact would be no greater than the fax machine (which he admitted was wrong) but he was also writing an article about how economists often get it wrong by overstimulating techs impact.
You can say that about 3D-TV, bitcoin, etc (Score:2)
Re: You can say that about 3D-TV, bitcoin, etc (Score:1)
What is the impact on GDP of smartphones, and should we even be using GDP growth as a criteria of success when it produces lower fertility, higher suicides, and its error margins are so wide anyway that economists, intellectually dishonestly, don't even report it?
What if GDP is a totem that only has meaning because economists believe in it and get everyone to hallucinate its reality?
Re: You can say that about 3D-TV, bitcoin, etc (Score:2)
Understandable (Score:2, Insightful)
Because it's all projection from people driving AI and not reality
Re: Understandable (Score:1)
Is GDP real? What are the error bars and why don't they report them?
"You must wait a little bit (2 minutes) before using this resource; please try again later."
Is there a physical constraint on the resource or is it an imposed arbitrary constraint that cynically uses the idea of scarce resources as an excuse, when actually the scarcity is entirely man-made?
Don't forget that it doesn't work + y2k part 2 (Score:5, Insightful)
So far LLMs are cool toys to play with and excellent negotiation tactics for tech companies to bring down developer salaries. However, if the hype was even partially justified, you'd DEFINITELY see GDP changes...either positive or negative. It's a license to print money, if it worked. There's a lot more demand than supply for software, maintenance, and customization...as well as optimizations and ports. How much can you make moving the world's COBOL to rust/Java/C/etc?...how about just moving shitty recent Python code to rust?...how nice would it be to write code in the language of your choice and have an AI convert it to a runtime that is twice as efficient and reduces your cloud spend tangibly?
If this shit worked, we'd see a y2k-like frenzy of people porting all their legacy apps into modern equivalents. A LOT of banks still use COBOL and are still doing so because they don't want to deal with the risk or cost of porting it. I assume a lot of businesses have useful VB apps lying around...legacy Ruby...PHP...Python/node.js apps that are painfully slow. We'd see a massive boom just from everyone getting all their apps into a modern state.
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But... But... I wrote a todo list app using AI.
Obviously that means it can cure cancer when asked, right?
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No. It can help you research papers about cancer, but If you want to cure it, you should use AI like AlphaFold3 which is made for curing deceases.
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... you should use AI like AlphaFold3 which is made for curing deceases.
Wow, AlphaFold3 can ressurect people?
Something I'm wondering (Score:2, Interesting)
There is still GitHub although I do wonder how long until it's filled with AI slop code. There will still be plenty of hobbyists though.
Not sure it's enough to just point the llms at run of the mill open source code that isn't extensively commented. What makes stack overflow work so well is that it isn't just code it's code with detailed explanations on how to use that code.
At least we now fully understand why Microsoft bou
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Re: Something I'm wondering (Score:2)
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That isn't really correct. AI has the POTENTIAL to do a lot for businesses, but unlike the PC or Internet, isn't inexpensive to implement or to turn into a positive thing for a business(that isn't based on selling AI based products/services). The idea that we can eliminate the annoying outsourced customer service with AI that can do the same job won't even save money when companies need to pay a lot to get that set up, but AI based customer service may be easier to understand for many people, and might
Fantasy AI? - Yes...LLMs? - are you sure? (Score:2)
That isn't really correct. AI has the POTENTIAL to do a lot for businesses, but unlike the PC or Internet, isn't inexpensive to implement or to turn into a positive thing for a business(that isn't based on selling AI based products/services).
Are you confident AI as we have it today has that potential?...or AI as you imagine it or have seen it portrayed in TV and movies? Yeah, Jarvis/Ultron was pretty awesome...but ChatGPT is no JARVIS. How much of the hype and investment do you think is based on realistic assessments of what the state of the art AI can do within the next year?...and how much do you think it's fantasy?...faith-based engineering?
Everyone I know is into the faith-based...they have faith it will get better and stop making so m
Re: Fantasy AI? - Yes...LLMs? - are you sure? (Score:2)
The drive through for Taco Bell, when it works, is better than many employees they have at getting my orders correct. Even ChatGPT at least understands the English language better than 75 percent of the customer service people I have dealt with over the past 10 years.
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convert it to a runtime that is twice as efficient and reduces your cloud spend tangibly
Smart companies are moving away from the cloud [horizoniq.com], smarter companies never migrated in the first place. It turns out that scale is a problem that everyone wants, but almost no one actually has. Of those that do, a sizable portion would be better off scaling vertically, the rest can save an absolute fortune by repatriating. I've often pointed people to this [nickcraver.com] article about the architecture of Stack Overflow. That's from 2016. What would you need to do the same with modern cloud-native best practices? Not lo
Looking in the wrong place... (Score:4, Insightful)
Check for dips instead of peaks, there you'll find the impact of AI stupidity on the economy.
For me it is mgmt hype... (Score:2)
Managers want to show to CEOs how smart and useful they are and talk about AI a lot...
Same CEOs when talking to shareholders...
In reality saving are much harder to find as it requires expensive AI experts and training and then someone has to fix the problems introduced by AI hallucinations and similar...
Re:For me it is mgmt hype... (Score:4, Informative)
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I think that Facebook's primary use case at this point is helping boomers share fake news and pig butchering scams with each other while they're looking at pictures of their grand kids that were cross-posted from Instagram.
I guess that's not totally fair... they also sell VR goggles that nobody uses a few weeks after buying them as well.
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Really? (Score:2)
Bubble butt, bubble bubble butt (Score:2)
Economic boost? (Score:5, Informative)
Let's take a peek at how the economy is doing under orange genius https://www.cnbc.com/2025/09/1... [cnbc.com]
The consumer price index, a key inflation gauge, rose 2.9% in August from a year earlier, the Bureau of Labor Statistics reported Thursday.
That’s an increase from 2.7% in July and the fastest annual pace of inflation since January.
Please stop I can't take much more winning.
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Russian incursions into Poland
War in Gaza continues and getting worse
Farmers risk foreclosure since China won't buy soybeans.
South Korea diplomatic disaster
India diplomatic disaster
How many trade deal? 0 or 1?
Military on the streets of American cities
The President signing off on political violence as long as he likes it
It's been 9 months
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I'm confused, I only watch Fox News and haven't heard any of this.
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Zero-sum game? (Score:5, Interesting)
My gut tells me that most of the current boom is zero sum game; people are paying too much for too little across the board, and the value ultimately provided just doesn't add up to much more than the sum of the parts. (Kind of like fusion power...)
Part of this situation is the cost for the data centers being pushed forward, their rapid depreciation rate, the high energy cost of queries... and the economic gain by the end user is just a proportionate loss by another player. Hard to say if this will change as things mature, but my guess is that an inflection point is way off.
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My gut tells me that most of the current boom is zero sum game; people are paying too much for too little across the board, and the value ultimately provided just doesn't add up to much more than the sum of the parts.
Indeed. I have a house for sale and it won't sell for more than $200k and yet I can't find a house (similar to mine) to buy that is less than $400k. Weird that.
95% of AI initiatives fail (Score:2)
This per an MIT study. So no, no increase in GDP.
But why is reality wrong? (Score:3)
"Why don't the actual numbers match our hype? Something must be wrong with reality!"
The answer is in the summary: "Revenue at US companies providing AI infrastructure has risen by $400 billion [...]"
Yeah, it's going gangbusters at the places that provide the AI. They've managed to convince everyone that AI is a "must have" technology. But why would anyone expect that to translate into more productivity or revenue at the places that actually use the AI? They're paying the AI providers, but whatever productivity or revenue is seen is being eaten by that new cost. What this shows is that AI isn't as useful as it's hyped up to be, at least at its current price point.
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+1, insightful
Trump vs AI (Score:1)
AI will reduce people to neo-serfdom (Score:2)
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AI is blatant class warfare (Score:2)
AI delivers value by cutting headcount, and transferring those salaries from the displaced employees to their corporate overlords. Margins go up, as does the stock price. However, Those former employees spent almost every penny they earned to survive (generating demand for goods, and this GDP), whereas the new recipients of those dollars hoard them in stock portfolios (gr