World.Alpha-News.org ➤ The news of the world is here
Study Reveals AI Can Strengthen Companies Rather Than Destroy Them

If a company can navigate the challenges posed by the adoption of artificial intelligence, it has the potential to thrive in the long run, according to findings presented at a European Central Bank conference.

The authors analyzed data from the U.S. Census Bureau and surveys conducted between 2017 and 2021, revealing that early adopters of AI in the manufacturing sector initially experienced a decline in productivity due to the replacement of human workers with robots. This contradicts the prevailing view that AI enhances productivity and augments jobs rather than eliminating them.

"In the short term, we see a lot of pain," said Kristina McElheran, one of the paper's authors. She attributed the productivity drop to AI disrupting established practices like maintaining low inventories.

Over time, companies that weathered the upheaval began to outperform their peers in sales growth, productivity, and employment. However, survival during this transition remained a significant challenge. McElheran noted that older and larger companies often struggled with this process.

The research involved a sample of 30,000 firms, during which AI adoption increased from 7.5% to 9.1%. Earlier in the conference, ECB President Christine Lagarde highlighted that while between 23% and 29% of workers in Europe are highly exposed to AI, this shift does not necessarily indicate a "job apocalypse," as it is likely that new roles will emerge even as old ones are phased out.