Greater AI utilisation could add $200 billion a year to the Australian economy, according to a new report 

Australia’s AI imperative: Greater AI utilisation could add $200 billion a year to the Australian economy, according to new report

Greater utilisation of artificial intelligence (AI) in key Australian industries will lead to a short-term boost in GDP of more than $200 billion per year and the creation of an additional 150,000 jobs from 2023-2030.  

These are the findings of Professor John Mangan, an emeritus professor of economics at The University of Queensland, in a comprehensive report on the current state of AI in Australia and the steps the country must take in order to ensure that it is a full partner in the AI economy.   

Australia’s AI Imperative: The economic impact of artificial intelligence and what's needed to further its growth, was published in April. The report states that for Australia to reap the far-reaching benefits of AI, it must introduce AI systems to world standards in industries such as technology, finance, healthcare, education, and government. The report also highlights the importance of increasing university funding for research into AI development and implementation as well as creating programs to up-skill Australian workers.  

“I was surprised at what seemed inertia on the part of government and some parts of industry in fostering the development of AI. This comes from a complacency in Australia due to our favourable trade position and historical high standard of living,” said Professor Mangan on what led him to write this report.  

“Hopefully, the report will show how Australia and the Australian Government are being left behind by comparative nations like Canada in their support for AI adoption and the economic costs this will bring, such as a decrease in competitive advantage.”  

Research featured in the report has identified that most AI benefits will initially flow to early adopters and that countries slow to adopt AI systems will continue falling further behind. The report also found that Australia could face an opportunity cost of 1.4% (or A$35.7 billion) of gross domestic product (GDP) per year if it fails to introduce AI systems to world standards in key industries. 

“What really hit me was how much more other comparable countries are spending on AI and how, even now, a few key nations – USA, China, UK– are establishing market control over AI innovations,” Professor Mangan said. 

“This will put Australia in the role of a perpetual client nation, depending on others for our AI systems.” 

But Professor Simon Lucey, Director of the Australian Institute for Machine Learning (AIML), says it’s not too late for Australia to make its mark in the AI space.

“The federal government hasn’t really committed to building an Australian AI capability yet. Most developed nations have had theirs up and running for several years now and some have even recently increased their funding considerably. In spite of this, we are blessed with an extraordinary depth of AI talent in Australia that has the potential to supercharge our economy,” said Professor Lucey.   

“AI’s a lightweight technology, so it delivers a return on investment quite quickly because it doesn’t need heavy infrastructure to get up and running. An investment in this year’s budget actually could turn things around.” 

The report was commissioned by the Kingston AI Group which comprises 14 professors of AI from eight Australian universities. Members are focused on developing Australia’s sovereign AI capacity to ensure the country’s future security and prosperity.  

“It’s absolutely imperative that Australia fosters its sovereign AI capability. AI will be ubiquitous, and we need a trained workforce who can discover and design, evaluate and translate new AI technologies,” said Kingston AI Group member and co-director for the Applied Artificial Intelligence Institute at Deakin University, Professor Svetha Venkatesh.  

“Without this, Australia will have no ability to meet current transformation demands, let alone lead in inventing new technologies.”  

“If Australia is to remain the lucky country it has been, profiting from the longest period of uninterrupted growth of any developed economy, then now is the time to increase our investment, skills, and participation in AI,” said Professor Toby Walsh, Kingston AI Group member and Chief Scientist of UNSW's AI Institute.  

“We need to invest now in our AI powered future. This report is a timely analysis and reminder of the opportunity that we are currently failing to seize.” 

The report also notes that economists are currently divided on whether the AI revolution is just another technology shift or a transformational change with no direct precedent. But no matter their position, many economists do not see the AI revolution creating mass unemployment, but rather, as the only way to avoid it.  

“Economists are not good at predictions,” said Professor Mangan. “The traditional, and still current view, is that technical change will, despite causing some disruption, be beneficial overall.” 

“But government and the public must play important roles to ensure these benefits. Government needs to make sure Australia and Australian exports are not left behind in AI adoption by other nations, as well as reduce public apprehension over AI.”  

 Australia's AI Imperative: The economic impact of artificial intelligence and what's needed to further its growth is available to download from the Kingston AI Group website.