What Happened
Consulting firm EY released new modelling on 10 August 2026 estimating that the rollout of artificial intelligence across the Australian economy could deliver a A$116 billion boost over the next decade and create more than 40,000 jobs.
The analysis, reported by Information Age, estimates the potential impact of AI by modelling productivity gains across different occupations and tracing how those gains could flow through to industries, investment, employment and whole-of-economy growth.
EY modelled three scenarios: a base case reflecting its central estimate of AI-driven productivity gains; a low scenario where gains are 10 per cent lower; and a high scenario where they are 10 per cent higher. Across those scenarios, AI could add between A$95 billion and A$116 billion to Australia's economy over the next decade, increasing real GDP by between 2.6 per cent and 3.2 per cent by 2036.
The firm also estimates AI could create between 36,000 and 44,000 additional jobs by 2036, though it cautions the benefits will not be evenly distributed.
Why It Matters
EY's modelling arrives against a backdrop of weak productivity performance in Australia. Labour productivity growth has averaged just 0.3 per cent a year over the past 10 years, less than a quarter of the rate recorded in the previous decade, according to the firm's analysis.
"Productivity is the main driver of long-term economic expansion and improvements in living standards, but Australia's performance has been weak over the past decade," EY stated. "That is why the potential productivity uplift from AI matters, not just as a technology story, but as an economic growth story."
The findings are also relevant to ongoing policy discussions. The ABC reported in August 2025 that the Productivity Commission had convened a roundtable on AI laws, reflecting government attention to how regulation and adoption settings could shape economic outcomes.
Key Details
EY estimates that AI could deliver a 2 per cent to 2.4 per cent boost to productivity, generating between A$31 billion and A$38 billion in additional investment over the next decade.
The modelling identifies construction as the sector expected to see the largest increase in full-time jobs. "Construction is expected to see the largest increase in full-time jobs as AI adoption lifts demand for new capital, equipment, systems and infrastructure, including the data centres and supporting infrastructure needed to enable the technology," EY said.
At the same time, the firm notes a shift in the composition of employment demand. "The modelling shows employment demand shifting toward sectors that benefit from stronger investment and household spending, while capital-intensive industries need fewer workers," EY stated.
The economic upside is conditional. EY said: "The analysis shows that if AI-driven productivity gains flow through to investment, capacity and output, they could deliver a meaningful lift to economic growth."
Background and Context
The EY report adds to a growing body of economic analysis examining AI's potential effects on the Australian labour market and national output. The Productivity Commission's August 2025 roundtable on AI laws, as reported by the ABC, indicated that federal policymakers were already weighing how to structure the regulatory environment around AI adoption.
EY's modelling approach traces productivity gains at the occupational level before aggregating effects across industries, which the firm says allows it to capture how AI adoption in specific roles flows through to broader economic activity.
What Comes Next
EY's analysis points to workforce policy as a central variable in whether the projected gains materialise. "Realising the economic benefits of AI will depend critically on workforce mobility and targeted reskilling," the firm said. "A key priority for employers and government should be helping workers move into the sectors and parts of businesses where demand is expected to grow."
The firm's three-scenario range, from A$95 billion to A$116 billion, reflects uncertainty about the pace and depth of AI adoption across the economy through to 2036.
