Artificial intelligence is expected to deliver a sizeable productivity boost for Australia over the coming decades, while also driving billions of dollars into the infrastructure needed to support its growth.
Modelling from Oxford Economics suggests AI could undertake the equivalent of around 15% of tasks currently performed by workers by 2060. The productivity benefit for Australia is forecast to reach about 2.5% by 2035 before increasing to 4.5% by 2060.
The growth of AI is also expected to accelerate demand for data centres. Investment in Australian data centre infrastructure is forecast to triple from $20 billion in 2026 to $60 billion by the end of the decade, according to Oxford Economics head of impact Michael Brennan.
“Whenever you build a data centre, you’re going to involve a whole supply chain of telecommunications, maintenance professional services, and engineering,” he said.
That spending is expected to flow through to a broad range of industries, generating employment during construction as well as through the ongoing operation and maintenance of facilities.
Data centre investment could contribute $78 billion to the Australian economy by 2030, while supporting an average of between 80,000 and 100,000 jobs each year.
“So this infrastructure build-out is going to have a pretty sizeable impact on the economy,” Brennan said.
Meeting the growing demand for computing capacity will also increase pressure on Australia’s electricity network. Data centres are forecast to account for between 5% and 12% of electricity consumption within the next decade.
The speed of development presents another challenge. Oxford Economics head of energy Alex Hooper said data centre developers were increasingly facing pressure to deliver projects that previously took around six years in as little as one year.
The energy infrastructure required to service those developments, however, can take considerably longer to plan and build.
“So there’s a little bit of a mismatch” that governments need to respond to, Hooper said.
