Back in the 1990s, something big happened—the Internet showed up in our lives and completely changed how people worked, shopped, and connected. At first, though, the benefits didn’t show up right away. Companies had to spend money building websites, laying down fiber-optic cables, and teaching workers how to use email. For a while, it looked like a lot of cost without much payoff. But once everything came together, productivity—that’s how much work we get done in a given amount of time—jumped in a huge way.
Between 1996 and 2005, the Internet lifted global productivity by about 1.5% per year. That added up to trillions of dollars in extra value worldwide. For example, retail companies like Walmart used the Internet to build smarter supply chains, banks moved services online, and call centers automated simple tasks so workers could focus on harder problems. The United States and Europe grabbed most of the gains early because they had the infrastructure in place, while other countries caught up later.
But here’s the key lesson: the Internet boom didn’t pay off overnight. It followed a “J-curve.” First came the heavy costs, then—after the systems were in place—the benefits started rolling in, leading to one of the fastest periods of global growth before 2008.
What AI Could Do Over the Next Five Years
Now we’re at a similar turning point with artificial intelligence. The difference is that AI doesn’t just make communication faster—it helps with thinking work. It can write code, sort through medical scans, detect fraud, and even act like a personal assistant. That means it goes beyond what the Internet did.
AI & the Productivity Boom: Why 2025–2030 Could Be a Game Changer
ARK Invest’s Bold Vision for an AI-Driven Economy
Big changes are coming—and fast. According to Cathie Wood and ARK Invest, we’re on the brink of the biggest productivity surge in history, driven by artificial intelligence.
4x Boost for Knowledge Workers
AI isn’t just speeding things up—it’s transforming how work gets done. From coding to content creation, ARK forecasts that knowledge workers could become 4x more productive, with AI taking over routine tasks and enabling humans to focus on high-value thinking.
$40 Trillion in Added Economic Value by 2030
AI, combined with robotics and energy breakthroughs, could push global GDP from $150T to $190Tby 2030. That’s 7%+ annual growth—more than double the historical average.
Cheaper, Smarter, Faster
AI compute is getting dramatically cheaper—up to 1,000x more efficient per dollar by 2030. This “deflationary boom” means falling costs, rising output, and accessible tools for businesses of all sizes.
Cathie Wood calls this a “rolling recovery” powered by AI—a shift that starts now and accelerates through 2027. If her team’s right, this decade could mark a new productivity renaissance.
Could AI Push Global Growth Higher Than Expected?
The International Monetary Fund (IMF) thinks the world economy will grow around 3% per year over the next five years. That’s decent but not amazing. With AI, though, growth could climb much higher—closer to 4% or even 5% a year in the best case.
Here are three possible futures:
- Bull case (4–5% growth): AI spreads quickly, companies adopt it widely, and new jobs and industries emerge, adding $10–15 trillion globally.
- Base case (3.5–4% growth): AI helps, but adoption is uneven, especially in developing countries.
- Bear case (3–3.5% growth): Power shortages, higher inequality, or slow adoption limit the gains.
No matter which path we take, the upside is clear: companies that invest early in AI, and workers who learn to use it, will benefit the most.
Why This Matters for You
The Internet reshaped how we live and work in just a decade. AI has the potential to do the same—but faster. The stakes are higher because AI doesn’t just move information; it can reason, create, and make decisions. That means the gap between those who adopt it and those who don’t could be even wider.
For businesses, the question is simple: are you preparing now, or will you wait and risk falling behind? For workers, the best step is to stay curious and learn how to use AI as a tool in your own job.
Just like the Internet boom gave us email, online shopping, and video calls, the AI boom could give us smarter healthcare, safer financial systems, and workplaces that get more done with less effort.
The bottom line: AI could reignite a 1990s-style productivity boom, and this time the whole world is invited.
Mike Frost
Frost Financial Group
This material is for informational purposes only and is not intended as investment advice. Past performance does not guarantee future results. Investing involves risk, including the possible loss of principal.
Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.