Those promoting AI would be lucky to see the technology’s impact on output per hour match even the short-lived burst of the 1990s and 2000s. Productivity growth will underwhelm, not because the technology is weak, but because it creates a bottleneck that earlier digital tools largely avoided.
OXFORD—“Something Big Is Happening,” wrote AI startup founder Matt Shumer in a recent viral essay that captured his industry’s swelling confidence that the technology will power the next great productivity boom. So far, the economy has not played along. In fact, since slowing sharply in the 1970s, US productivity has experienced only one brief burst of growth: the computer age. Output per hour surged by roughly 3% per year in the late 1990s and early 2000s, and then it petered out.