The latest surge in US productivity suggests the AI boom is providing lasting benefits to the US economy that go well beyond just the value of investment in data centres. Non-farm business productivity increased at a 4.9% annualised pace in the third quarter, following a 4.1% increase in the second. Admittedly, after a weak first quarter when both GDP and productivity fell, the 12m growth rate of productivity is a more muted 1.9%. Nevertheless, that is still a significantly stronger performance when compared with other DMs and the pre-covid decade in the US, when productivity growth was averaging roughly half that pace at around 1%.
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