Musk says AI could lift US GDP growth to about 4% in 2027
Elon Musk said on X that artificial intelligence could lift US GDP growth from about 2% to roughly 4% in 2027, or even higher. The forecast comes as investors debate whether massive spending on AI infrastructure will translate into broad productivity gains, and how quickly.
Apollo chief economist Torsten Slok estimated that AI-related capital expenditure in the US could reach about 3% of GDP annually from 2027 to 2029, up from about 0.6% three years earlier. Moody's analysts said US tech companies are expected to spend nearly $1 trillion on chips and data centers by 2027. Such spending would directly support economic activity, but the bigger question is whether it can generate the productivity gains needed to sustain 4% growth.
Historical technology booms suggest there can be a significant lag between investment and economy-wide productivity gains. The internet boom of the 1990s took years to show up in broad productivity growth. Still, companies are already deploying generative AI and increasingly autonomous agents in software development, research, customer service and other areas. If these tools quickly raise output per employee, the economic payoff could come faster than in previous tech cycles.
Mainstream forecasts remain more cautious. Morningstar expects US growth to slow by 2027 rather than accelerate to Musk's 4% target. Interest rates could add further pressure. The Federal Reserve raised its benchmark rate to 4.00% in September, and Goldman Sachs expects another hike in October. Analysts say higher rates are unlikely to stop the biggest tech companies from investing heavily in AI infrastructure, but could make it harder for smaller firms to fund AI adoption.
Meanwhile, US consumers remain a strong driver of growth. Retail sales rose 1.2% month over month in August, above the 0.8% expected gain; core retail sales rose 1.4%, also beating forecasts. If large-scale infrastructure spending begins to produce measurable benefits across the broader economy, Musk's 4% prediction may look less striking. For now, however, his vision still diverges sharply from mainstream economic forecasts.
