Economic Impact and Labor Market Disruption of Agentic AI

This technical report from Allianz Research discusses the implications of agentic AI, which is characterized by autonomous decision-making capabilities. The report outlines the potential economic benefits, estimating global gains of USD2.6-4.4 trillion over the next two to five years, driven by increased productivity and innovation. However, it raises concerns about the risk of widespread unemployment, noting that up to 60% of jobs in advanced economies could be affected. The analysis includes a comparison of labor demand across various countries, revealing a substitution effect where increased software and R&D investments correlate with reduced employment. The report emphasizes the need for a comprehensive public policy approach to address labor market disruptions, suggesting measures such as retraining programs and new social initiatives to support displaced workers. The findings indicate that agentic AI may drive more labor substitution than previous technological advancements, necessitating proactive strategies to manage the transition.