Here’s how much money companies can save by using AI to replace human workers

There’s no shortage of stories on how AI is coming for your job. Artificial intelligence is the topic we love to hate, yet people, not to mention the media (guilty as charged), can’t stop talking about it.

Most Read from Fast Company

4 ways to spot a self-centered person in 5 minutes or less, according to psychologists Amazon’s culture isn’t for everyone. AWS CEO Matt Garman explains why it has kept him at the company for 20 years Quiet firing is spreading, but there are business risks to tactics to push workers out

Yet the question most business leaders have is slightly different. They want to know how the AI revolution will affect their bottom line. A new report from Morgan Stanley looks into that—and here’s what it found.

How much will companies save?

The short answer, according to Morgan Stanley’s report, is that corporate adoption of AI has the capacity to reshape the future of work, saving businesses nearly $1 trillion a year.

The report, “AI Adoption and the Future of Work,” which was viewed by Fast Company, suggests S&P 500 companies could accrue annual net benefits totaling some $920 billion a year. The bank looked at potential future states of AI-driven labor impacts and saw benefits from cost reduction, as well as a productivity lift. A good portion of those savings could come from employing fewer people and from natural attrition as tasks are automated and productivity increases.

They also found that adopting AI could translate into some $13 trillion to $16 trillion in long-term market value creation potential for those S&P 500 companies.

What’s the fine print?

The savings won’t come all at once. Morgan Stanley’s analysis shows there will be some up-front costs at the beginning of the rollout, and also the returns won’t come in for a while, likely years.

So, how will this affect my job?

According to the bank’s report, 90% of jobs will be impacted by AI automation and augmentation to some extent—but that doesn’t mean all those jobs will become obsolete.

Which sectors are most exposed?

AI could generate pre-tax savings in many industries. Sectors with the highest returns are consumer staples distribution, retail, real estate management, and development and transportation, which could see more than 100% of expected 2026 pretax profits.

Meanwhile, the technology hardware and equipment and semiconductor sectors are not expected to save as much.

This post originally appeared at fastcompany.com
Subscribe to get the Fast Company newsletter: http://fastcompany.com/newsletters

View Comments