RBA Says AI Has Not Yet Lifted Productivity or Caused Widespread Job Losses in Australia

Reserve Bank of Australia Assistant Governor Sarah Hunter said on Monday there was limited evidence that artificial intelligence had meaningfully lifted productivity and caused widespread job losses. Her assessment challenges narratives of immediate economic transformation.

Speaking at a UBS conference in Sydney, Hunter acknowledged that AI investment is already affecting inflation and warned that it could pose risks to financial stability. She noted that if AI delivers broader productivity gains, economies will be able to produce more with the same inputs, implying the impact is still potential [6].

No measurable productivity gain yet

Hunter said there was "limited evidence that artificial intelligence had meaningfully lifted productivity and caused widespread job losses" [6]. The RBA's assessment challenges widespread claims that AI is already delivering economy-wide efficiency gains.

Hunter did not dismiss AI's long-term potential. She said: "If AI delivers broader productivity gains, economies will be able to produce more with the same inputs" [6]. That conditional phrasing underscores that the RBA treats productivity improvement as a future possibility, not a current fact.

Data centre boom is lifting rates now

While there is limited evidence of a material productivity lift from AI, its capital demands are already shaping monetary policy. A surge in domestic data centre investment has added to demand pressures in the Australian economy, and Hunter identified it as one reason the RBA has raised interest rates five times this year to an 18-year high of 4.85% [6].

The inflationary impact, she said, will likely vary over time. Initially, AI investment boosts demand and adds to price pressures while the economy is supply-constrained. "Over time, supply will catch up with demand as data centre capacity and related sectors expand, easing current bottlenecks," she said [6]. If productivity gains eventually materialise, the initial inflationary pressures would dissipate.

Tentative labour market signals

Hunter noted "tentative signs of adjustment" rather than large-scale displacement. She pointed to "weaker job ad posting and employment outcomes in more AI-exposed occupations, and stronger growth in areas where the technology has had less of an impact, particularly for younger workers" [6].

This nuance matters. The RBA is not claiming AI has no labour market effect; it is saying the effect is not yet visible in aggregate job losses. The shift appears concentrated in hiring patterns within exposed occupations, not in economy-wide unemployment.

Financial stability warning

Hunter also flagged a growing risk: asset prices could face "sharp repricing or even disorderly adjustments if AI investment returns fall short of expectations" [6].

What this means

The RBA's assessment provides a data-grounded perspective that counters optimistic narratives about AI's near-term economic impact. It confirms that:

• AI investment is real and large enough to move interest rates.
• Productivity gains have not yet shown up in the numbers.
• Labour market effects are early, uneven, and not yet aggregate job losses.
• The main immediate macroeconomic impact is demand-side inflation pressure from capital spending.

What remains unknown is the timeline. Hunter's "if AI delivers" formulation leaves open whether productivity gains arrive in years, decades, or not at all. The RBA will watch for evidence, not promises.