IMEN Letter August 2026 #4: AI and Labor Productivity

Interesting results emerged in our recent poll on the labor productivity effects of AI. There is no consensus among our respondents. 48 percent expect a moderate acceleration in labor productivity growth, while significant shares anticipate either a boom or no meaningful change.

In the United States, where AI creation and adoption tend to be faster than in European economies, we have indeed seen a moderate acceleration in labor productivity growth in recent years. The same pattern can be observed for total factor productivity growth. While labor productivity growth is also affected by the investment boom since the pandemic, total factor productivity growth captures productivity gains unrelated to factor accumulation. Future analyses might be better able to disentangle the productivity‑enhancing effects of AI from other potential determinants such as remote work or demographic factors.