As nonprofit leaders aware of AI’s transformative potential, we’ve all followed the reports from McKinsey, Microsoft, and others detailing how AI is reshaping the workplace. A recent report titled “Generally Faster: The Economic Impact of Generative AI” adds perspective to this ongoing conversation by analyzing the speed and scale of AI’s economic impact.

The report’s author, Andrew McAfee, is a principal research scientist at MIT and the inaugural visiting fellow in the Technology and Society group at Google. McAfee has spent over 15 years investigating digital technologies. He’s co-authored books on the subject, including “The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies . Recognized as one of the world’s top management thinkers. McAfee is also a co-founder of the generative AI company Workhelix.

McAfee’s April 2024 report, written during his Google residency, builds upon his research and l experience.  What are some of his observations that are useful for the nonprofit sector?

Accelerated Adoption and Impact

While many studies have focused on AI’s long-term potential, McAfee’s report emphasizes the rapidity of generative AI’s integration into existing systems. McAfee argues that generative AI’s impact will be felt within this decade, unlike past general-purpose technologies that took decades to show economy-wide effects,

If this is true, this accelerated timeline will have significant implications for strategic planning in the nonprofit sector. The report estimates that 80% of U.S. jobs could see at least 10% of their tasks completed twice as fast with generative AI without compromising quality. As we have heard from other researchers, this efficiency is changing the nature of work. 

• In healthcare, physicians complete daily patient notes 83% faster.
• Management consultants finish tasks 25% faster and with 40% higher quality.
• Programmers complete coding tasks 56% faster.

This rapid productivity boost could increase nonprofits’ capacity to deliver services and drive impact. However, it also raises questions about how quickly we must adapt our operations, training programs, and workforce strategies to remain effective.

Economic Growth and Its Implications

McAfee projects that generative AI could add 0.4 percentage points to U.S. GDP growth annually over the next decade. This represents a significant boost – potentially increasing economic growth by 20% above the recent baseline of about 2% per year.

For nonprofits, this level of AI-driven growth could have far-reaching implications:

• Potential for increased charitable giving: Economic growth has historically correlated with increased charitable giving. For instance, during the economic expansion from 2009 to 2019, total charitable giving in the U.S. grew by 2.4% annually on average (adjusted for inflation). If this pattern holds, AI-driven growth could lead to a substantial increase in available funding for nonprofits.
• Evolving societal needs: As AI reshapes industries and job markets, new challenges will emerge. Nonprofits may need to adapt their programs to address technological displacement, the need for reskilling, or the mental health impacts of rapid change.
• Shifting policy landscapes: Governments will likely develop new policies in response to AI’s economic impact. For example, the U.S. National AI Initiative Act of 2020 aims to accelerate AI research and application for economic and national security needs. Such policies could affect key nonprofit areas like education, workforce development, and social services.
• Workforce transformations: Long-term projections suggest significant changes in the job market due to AI and automation. A 2017 McKinsey report estimated that up to 375 million workers globally might need to switch occupational categories by 2030. This could dramatically increase demand for nonprofits offering job retraining, career counseling, and related services.

It’s important to note that while these projections offer insights, the actual impact of AI-driven growth may differ from historical patterns. The COVID-19 pandemic has demonstrated how unforeseen events can rapidly alter economic landscapes and societal needs. 

Rethinking Organizational Processes

McAfee argues that generative AI’s most significant benefits will come from reimagining entire organizational processes, not from task-level improvements and automation. I haven’t seen this yet, but if it is correct, it means putting more effort into how AI might fundamentally reshape our operating models, how we identify community needs, and how we measure and report impact.

Challenges and Ethical Considerations

McAfee’s report also acknowledges the risk of AI intensifying workplace inequalities and the economic challenges of a fast-moving technological shift.

As nonprofit leaders, we are responsible for dealing with how these issues can affect our organizations. 

• How do we ensure that our use of AI aligns with our missions and values? 
• How can we be at the forefront of discussions about ethical AI deployment, particularly in sensitive areas like social services or education?

Strategic Implications for Nonprofits

McAfee’s analysis suggests some critical considerations for nonprofit leaders:

• Strategic Planning: Are we effectively incorporating AI’s potential impacts into our long-term strategic planning processes?
• Workforce Development: How can we foster meaningful AI literacy and competence across all levels of our organization?
• Ethical Leadership: Acknowledging the historically appropriative and white male-centered development of AI, how do we build necessary skills while actively promoting equity, inclusion, and ethical practices in AI use and development?
• Systems Change and Policy Engagement: As AI reshapes economic and social landscapes, how can we ensure it strengthens rather than undermines the frameworks and communities we serve?

Conclusion

McAfee’s report suggests that the AI revolution isn’t just unfolding—it’s accelerating at a pace that threatens to leave many behind, intensifying existing inequalities. As nonprofit leaders, we can either passively adapt to these changes or work with others to reshape the trajectory of AI development and deployment so it is more ethical and inclusive.

• As you think about AI becoming a more utilized force in your sector, how do you think about how your usage of AI can support social justice and systems change versus reinforcing corporate structures?
•  How are you preparing now for a world where AI accelerates both routine tasks and higher-level strategy and where delay in addressing this could leave your organization unprepared?

I am very interested in discussing this. We can’t make improvements in our sector that leave people behind or don’t reflect the values and interests of our communities and those we serve.