Artificial intelligence is reshaping the US job market. And the young tech workers are bearing the brunt of it.
“It's true that AI is beginning to appear more clearly in the data,” wrote Jan Hatzius, chief economist at Goldman Sachs, in a memo on Monday.
Goldman's analysis shows that the share of the high-tech sector of the US job market peaked in November 2022 when ChatGPT was launched, then fell below the long-term trend.
This impact was particularly keen for young tech workers. Technology's 20-30 year old unemployment rate has risen by nearly 3 percentage points since early 2024, up four times the overall unemployment rate.
That spike is another indication that generative AI is beginning to oust white-collar jobs, especially among early career workers.
“This is still a small share of the overall US labor market, but we estimate that generative AI will ultimately drive away 6-7% of all US workers,” Hatzius writes.
Goldman expects the shift to occur over the next decade. Companies predict that the impact of peak unemployment will be limited to “manageable” 0.5 percent points as other industries absorb many displaced people.
The report comes amid growing concerns about weakness in the US labor market.
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The US economy added just 73,000 jobs in July, according to data from the Bureau of Labor Statistics on Friday. Job growth in May and June also fell sharply.
“The number of jobs on Friday reinforced our view that US growth is near a stalling rate, a pace at which the labor market becomes weaker in a self-enhancing way,” Hatzius wrote.
Despite the impact of AI, Hatzius pointed to a larger short-term problem: slowing down US output growth.
Goldman estimates that actual GDP grew at an annual rate of 1.2% in the first half of the year. Analysts write that they are hoping for a “similarly slower pace” in the second half.
“While easing financial position and picking up trust in business should support growth, actual disposable income and consumer spending are likely to grow very slowly, not only due to weak employment growth, but also because most of the pass-through from tariffs to consumer prices is ahead of us,” Hatzius wrote.
Technology leaders warn about the AI-induced work cliff. In May, humanity CEO Dario Amody said AI could eliminate 50% Entry-level white-collar work Over the next five years.
