Classic industrial jobs will hardly change as a result of artificial intelligence. Academics and office workers in the manufacturing sector, on the other hand, can often get help from AI, according to a study.
The use of artificial intelligence (AI) could give German industry a boost worth billions. According to a study by the research institute IW Consult on behalf of Google, which was presented on Tuesday in Berlin, gross value added in the manufacturing sector could be increased by up to 7.8 percent through generative AI. That corresponds to a total increase of 56 billion euros. Gross value added refers to the total value of goods and services minus intermediate services, and thus the added value created in the production process.
Generative AI is a variant of artificial intelligence that can be used to create (“generate”) new, original content. With the help of algorithms and so-called language models, content such as texts, images and videos, but also music or program codes, can be generated. The specifications for the AI system do not have to be programmed, but can be transmitted in natural language. A significant milestone for generative AI was the release of the chatbot ChatGPT by the start-up OpenAI in November 2022. Google, among others, offers its own dialogue system for generative AI, Gemini, which competes with ChatGPT.
Jobs of academics and office workers are particularly affected
According to the study by the subsidiary of the German Economic Institute (IW) in Cologne, academics and office workers in particular have to prepare for major changes in their work caused by AI. In the manufacturing sector, there are around 0.6 million employees for whom AI is expected to have a strong impact on their work. For a further 4.1 million employees, generative AI can support their own work, for example in optimizing program codes or as a source of ideas in product design.
In everyday life, however, in classic industrial jobs such as repair or maintenance work, AI will be used much less often. According to the study, these approximately 3.3 million jobs cannot be automated or can only be automated with difficulty using AI. This affects around 41 percent of all jobs in the manufacturing sector.
Productivity has remained almost unchanged in some cases recently
The director of the Cologne Institute for the German Economy, Michael Hüther, explained that since 2018, real labor productivity in mechanical engineering and other areas of the manufacturing industry has remained almost constant, increasing by just 0.4 percent per year. “Through generative artificial intelligence, the industry could achieve a significant AI dividend and thereby secure its productivity advantages on global markets.” It is encouraging that many companies have already recognized this opportunity.
The IW study shows that more than 50 percent of industrial companies in Germany are already using AI. This means that the industry is well above the average for the German economy (17 percent). Artificial intelligence is used in the manufacturing industry to automate internal systems (42 percent), write documents (31 percent) and analyze data (24 percent).
The manufacturing industry is one of the most important economic sectors in Germany. According to IW, the added value in this area is 781 billion euros and there are almost eight million employees. Compared to other industrialized countries, the manufacturing sector’s share of overall economic value creation in Germany is significantly higher at more than 20 percent and is almost twice as high as in Great Britain or the USA. For the entire economy, the possible value creation using AI is estimated at 330 billion euros.
Source: Stern
