Goldman Sachs Data Shows AI’s Unemployment Impact

AI is eliminating jobs in the U.S., especially for young tech workers just starting in their careers.

In a Monday Goldman Sachs note, obtained by Business Insider, the investment firm wrote that since ChatGPT was introduced in November 2022, the tech sector’s share of U.S. employment, which had just hit its highest point, has been declining.

Unemployment is especially high for 20- to 30-year-olds aiming to work in the tech sector, the report found. Since the start of 2024, the unemployment rate for that group has risen by nearly 3%, more than four times greater than the overall rate. Goldman Sachs says that the increase is an indicator that AI is starting to take over white-collar work, starting at the entry level.

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The bank’s Chief Economist, Jan Hatzius, estimated in the note that AI will replace 6% to 7% of all U.S. workers within the next decade. However, he predicted that the unemployment rate would only grow by a “manageable” 0.5% due to AI, because affected workers would shift to other industries.

AI isn’t just increasing unemployment by taking over entry-level tech jobs — it is also causing mass layoffs. According to a Tuesday report shared by the coaching company Challenger, Gray & Christmas with CBS, AI has directly caused more than 27,000 job cuts in the private sector since 2023.

“The industry is being reshaped by the advancement of artificial intelligence,” Challenger, Gray & Christmas told CBS.

Related: Is AI the Reason for Your Layoff? New York Becomes the First State to Require Companies to Disclose If So.

Tech leaders are also sounding the alarm on the technology’s ability to replace jobs. Dario Amodei, the 42-year-old CEO of AI startup Anthropic, predicted in May that AI could eliminate half of all entry-level, white-collar work and result in unemployment rising to as much as 20%.

AI will affect white-collar industries like technology, law, and finance, Amodei said.

Nobel Prize winner Geoffrey Hinton, 78, had a similar prediction. Hinton, who is often called the Godfather of AI because of his pioneering work on neural networks, forecast in June that “AI is just going to replace everybody” in white-collar jobs.

“I think for mundane intellectual labor, AI is just going to replace everybody,” Hinton said at the time.

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