High-AI industries drove 2.0pp of productivity growth
Productivity growth is concentrated in high-AI industries. @morganstanley puts their contribution at 2.0pp of 2.4% economy-wide output/employee growth in Q4 2024, up from 1.4pp a year earlier. Mid/low-AI sectors contributed only 0.4pp, with that contribution declining.
The main driver in high-AI sectors is output expansion. @morganstanley sees measurable labor displacement, but it remains secondary to capital deepening and output growth. The productivity gains extend beyond payroll cuts.
@morganstanley dates the acceleration to late 2024, with the Q2 2025 contribution above trend. Revised GDP and payroll data up to 2Q 2026 show stronger output growth in high-AI industries and downward revisions in mid-AI sectors. The evidence supports continued high-AI leadership. Economy-wide participation is still narrow.
Productivity growth is concentrated in high-AI industries. @morganstanley puts their contribution at 2.0pp of 2.4% economy-wide output/employee growth in Q4 2024, up from 1.4pp a year earlier. Mid/low-AI sectors contributed only 0.4pp, with that contribution declining.
The main driver in high-AI sectors is output expansion. @morganstanley sees measurable labor displacement, but it remains secondary to capital deepening and output growth. The productivity gains extend beyond payroll cuts.
@morganstanley dates the acceleration to late 2024, with the Q2 2025 contribution above trend. Revised GDP and payroll data up to 2Q 2026 show stronger output growth in high-AI industries and downward revisions in mid-AI sectors. The evidence supports continued high-AI leadership. Economy-wide participation is still narrow.