International comparisons show AI effect on productivity

There is a positive relationship between artificial intelligence exposure and labor productivity growth in U.S. industry. But is AI itself responsible for that growth in the sectors most exposed to it? Because AI use varies across countries, we can draw on international data to investigate the relationship between AI exposure and productivity growth at the sector level. The positive relationship in the U.S. fits a pattern visible among countries and appears related to high AI use. U.S. labor productivity has grown at an annualized rate of 2.4 percent since the beginning of 2024. This compares to average productivity growth of 1.6 percent in the five years before the pandemic. Recent productivity growth has been especially strong in the information, finance and insurance, and professional and technical services sectors.