Australia AI productivity could receive a major boost as artificial intelligence adoption is projected to add up to $116 billion to Australia’s economy over the next decade and create up to 44,000 additional jobs, according to new modelling from consulting firm EY-Parthenon. The findings, reported by news.com.au on August 6, 2026, suggest AI could help reverse the country’s decade-long productivity slump that has weighed on wages and living standards.
The report found that greater AI uptake could raise real GDP by between 2.6 per cent and 3.2 per cent by 2036, adding $95 billion to $116 billion to the economy, alongside 36,000 to 44,000 additional full-time jobs and $31 billion to $38 billion in extra investment.
EY Oceania chief economist Cherelle Murphy said the analysis showed AI adoption could deliver “a much-needed productivity lift” over the coming decade. She said construction was expected to see the largest job gains, driven by demand for new capital, equipment and infrastructure, including data centres needed to enable the technology.
The report comes as Australia’s labour productivity growth has slowed sharply since 2016. The 20-year average annual growth rate stood at 1.8 per cent in 2004, falling to 0.9 per cent by 2023 and 0.8 per cent in 2024. Murphy said productivity growth had averaged just 0.3 per cent a year over the past decade, less than a quarter of the previous decade’s rate.
Alongside construction, Murphy identified wholesale and retail trade, and transport and warehousing as industries positioned for AI-driven growth. By contrast, the modelling pointed to the largest job losses in agriculture and mining as AI adoption Australia-wide continues to reshape the labour market. She said employment demand would shift toward sectors benefiting from stronger investment and spending, while capital-intensive industries would need fewer workers.
The report’s release follows news this week that Qantas is in talks with consultants about offshoring around 1,000 marketing, finance, HR and back-office roles to South Asia as part of its AI-driven push. A Qantas spokesperson said the airline was “looking at ways to accelerate the use of technology and AI to help us modernise the way we work and deliver better outcomes for our customers and our people.” The move illustrates the kind of workforce shift flagged in the EY-Parthenon modelling.
The Australian Bureau of Statistics has separately tracked the productivity slowdown referenced in the report. The government has also held talks with the United States this week, involving the Albanese government, aimed at securing access to high-powered AI technology. The country’s broader AI ambitions are also reflected in its growing innovation ecosystem, alongside rising Australia EV sales as advanced technologies continue to reshape the economy.
No timeline has been given for when the projected gains from AI economic growth might materialise beyond the 2036 horizon. EY-Parthenon’s analysis reflects projected adoption trends rather than confirmed government policy, and outcomes will depend on the pace of AI integration across Australian industries.
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