AI Productivity Boom Will Come, But Could Take a While to Get Here

Dr. Jeffrey Roach, Chief Economist for LPL Financial dissects some key metrics on AI usage and what it means for productivity and inflation.

Last Edited by: LPL Research

Last Updated: November 19, 2025

Transcript

Dr. Jeffrey Roach (00:08):

I am Jeffrey Roach, Chief Economist for LPL Financial with three talking points for the current macro landscape. First, AI usage has a lot more upside. One of the trends I track is the share of U.S. businesses with paid subscriptions to AI models, platforms, and tools, which is what we call the AI adoption rate. And if we break out that rate by firm size, we see that adoption rates took a downward turn for medium and small-sized firms. But that was after a quick acceleration in the first half of this year. So despite the downturn in usage, I think the more dramatic statistic to highlight, and probably the correct one, is that less than half of U.S. firms have any line item in their budgets for these tools. And what that tells me is that we are still in the very early stages of AI usage in the U.S.

Dr. Jeffrey Roach (01:03):

Second, labor intensive sectors have the most to benefit. The sectors I see as having the most to benefit from AI tools and platforms are also some of the sectors with the lowest adoption rates across all industries. And it's not surprising that the information and technical services sectors have high adoption rates, but the low adoption rates in restaurants and hotels and healthcare is noteworthy. These sectors are highly labor intensive, so the opportunity for greater AI usage there could ease up inflation pressures. Third, productivity boom may take a while. AI will likely supercharge productivity in the U.S. and simultaneously relieve inflation pressures. However, we should not expect that payoff to happen overnight. History offers some perspective. Transformative technologies like the personal computer and cloud computing took maybe up to five years before their impact on productivity became clear. AI will likely follow a similar trajectory. Big gains, but not instant ones. Well, that's all for now. If you want more insights on global market trends, follow us on social media and take care.

Dr. Jeffrey Roach, Chief Economist for LPL Financial dissects some key metrics on AI usage and what it means for productivity and inflation.

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