Canada’s economic productivity is lagging behind the U.S. and more industries should embrace generative artificial intelligence to catch up, according to a report from Royal Bank of Canada.
Generative AI has the potential to boost Canada’s economy by $180 billion per year by 2030, but 73 per cent of Canadian businesses haven’t even considered using it yet, the report said, citing a Statistics Canada survey from earlier this year.
Some of the country’s major industries, including natural resources, haven’t been significant early adopters of AI tools, according to the research. Meanwhile, costs are a barrier small businesses, which make up the vast majority of Canadian companies: 98 per cent have fewer than 100 employees.
Productivity in Canada — production per hour worked — is 30 per cent lower than in the U.S., partly because of the public-sector-dominated health care and education industries, RBC said. Only a sliver of government operations have adopted generative AI, despite Canada’s strong presence in artificial intelligence research.
“Unfortunately, Canada has simply been better at generating ideas and developing models than putting them to work,” the report said. “Canada’s three National AI Institutes are recognized as world-leading, and some of the great minds in machine learning call Canada home.”
RBC urged firms and government bodies to experiment with AI on a smaller scale first. “Companies don’t need to begin with organization-wide transformational Gen AI projects. They can start by using it to tackle smaller practical challenges and then leverage the success to other projects.”
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