Global AI Disruption Warning

IMF Managing Director Kristalina Georgieva has warned that artificial intelligence could affect approximately 40% of jobs worldwide. In advanced economies, the disruption is even more acute, with up to 60% of jobs potentially affected by AI-driven labour market changes.

Georgieva characterised AI’s impact on the labour market as a ‘slow-moving tsunami’, highlighting the scale and trajectory of the challenge ahead. She identified young graduates entering the job market as the group most exposed to AI-driven labour market disruption.

The Jobs Quality Challenge

A critical concern centres on job quality. According to Georgieva’s analysis, net employment growth from AI is concentrated in lower-paying jobs—raising questions about wage levels and career progression in an AI-driven economy.

Entry-level career opportunities are placing unprecedented pressure, creating a particular challenge for the estimated 1.2 billion young people globally who need employment.

Government and International Response

World Bank President Ajay Banga has called on governments to unlock private capital to create jobs for 1.2 billion young people. He has also backed ‘small AI’ tools as part of the employment response strategy.

Singapore President Tharman has urged governments to make ‘crisis-era’ employment support measures permanent and to incentivize firms to hire young graduates—signalling the need for sustained policy intervention.

Building Capacity for AI Benefits

Georgieva has urged governments to invest in skills development to prepare workers for AI-driven changes in the labour market. According to IMF analysis, countries’ ability to build AI infrastructure and skills will determine the economic benefits they receive from AI.

Effective AI integration into labour markets requires monitoring employment trends and reforming education and tax systems—measures that will be critical for European and Irish policymakers navigating this transition.

Source: CNBC