Barclays Research Predicts AI Will Transform Global Supply Chains and Labor Markets

Barclays Research expects artificial intelligence (AI) to significantly reshape global supply chains, labor markets, and energy sectors. This prediction comes from the 70th edition of the Barclays flagship Equity Gilt Study, which explores the long-term impacts of AI-driven disruptions and other structural forces on the global economy. LONDON—(BUSINESS WIRE)—In the latest Equity Gilt Study, Barclays Research analysts examine the multifaceted ways AI is transforming the modern economy and financial markets. According to Ajay Rajadhyaksha, Global Chairman of Research, AI's influence will continue to grow over the coming years, with potentially positive outcomes for the world at large. The Geopolitics of Minerals and Minds Barclays Research underscores the strategic risks posed by the global reliance on a few countries for critical rare earth elements and skilled AI talent. This concentration of resources and expertise can undermine supply chain stability, particularly in the face of geopolitical tensions, trade disputes, and climate-related shocks. AI and the New Skills Divide Using eight years of data, Barclays analysts note that AI’s impact on employment has been relatively modest thus far. However, AI is already altering the skill requirements and nature of tasks, particularly in higher-paying, white-collar positions. As AI adoption increases, the potential for broader macroeconomic effects is expected to grow. AI’s Market Divide Barclays analysts anticipate that the widespread integration of AI could have profound implications for investment returns. Drawing parallels to historical technological advancements like the post-WWII durable goods revolution, the internet boom of the 1990s, and the data explosion of the 2010s, they suggest that AI could lead to gains in equity markets, increased yields across various financial instruments, and a moderately stronger U.S. dollar. Deep Impact The sudden emergence of DeepSeek, a Chinese AI company, has been likened to a "Sputnik moment" for the U.S. and other developed nations, catalyzing a surge in AI infrastructure investments. Barclays believes this capital expenditure arms race is far from over, driven by the substantial computing power required for complex, multi-step workloads. Notes to Editors The Barclays Equity Gilt Study is an annual publication that offers market-leading macro analysis combined with a unique multi-asset dataset covering over 100 years. It provides detailed data and commentary on long-term asset returns in the UK and US, with UK data dating back to 1899 and US data from 1925, sourced from the University of Chicago’s Center for Research in Security Prices. About Barclays Investment Bank Barclays Investment Bank aims to be the UK-centered leader in global finance. It operates as a diversified bank with a strong presence in UK consumer, corporate, and wealth and private banking, as well as a leading global investment bank and a specialized US consumer bank. The Investment Bank serves money managers, financial institutions, governments, and corporate clients, helping them address their funding, investing, financing, and strategic and risk management needs. For more information, visit www.barclays.com/ib. More News From Barclays For additional updates and insights from Barclays, stay tuned to our news and publications.