IMF Warns AI Will Reshape 40% of Global Jobs, Hits Gen Z Hardest

The IMF estimates that around 40% of jobs worldwide will be augmented, downgraded, or eliminated as AI advances — and the fund's managing director says young workers will take the first hit. Kristalina Georgieva likened the coming disruption to a "slow-moving tsunami" and warned that Gen Z graduates could find the traditional career ladder missing its bottom rungs.

"The people to worry about first and foremost are young people that are coming into the labor market," Georgieva said at an event held alongside the IMF and World Bank annual meetings in Bangkok on Monday. "Normally, they would get into these routine, repetitive jobs and then grow up the ranks. But if they're gone, I don't think any young person wants to be a barista in a coffee shop as their professional future."

Her framing matters for hiring plans. The IMF chief said AI is already reshaping pay and demand: workers with AI-related skills are earning more, but that premium hasn't produced broad-based job growth. Lower-paying roles, including restaurant jobs and data center construction, are growing, while middle-skilled workers with high automation exposure risk being left behind. Advanced economies face a particularly significant impact.

Georgieva pushed back on the gloomiest reading of the data. "Burst the myth that AI is shrinking demand for people," she said. "What it is doing is shifting demand for people now. That may not be the case in the future."

What does this change for governments and employers?

Georgieva's argument to policymakers runs through the fiscal ledger, not just the social one. Major labor market disruption means less spending, which means less tax revenue — leaving governments in a tough financial spot. Her prescription: rethink education for a world where workers can no longer learn one skill set and rely on it for an entire career.

Singapore President Tharman Shanmugaratnam, who joined Georgieva onstage, put numbers on the problem. "The first rung in employment, your first job upon graduation, is now seeing less demand," he said. In Singapore, 74.4% of university graduates secured full-time positions in 2025, down from 79.4% in 2024 — a five-point drop in a single year, according to data reported by the Straits Times.

Shanmugaratnam urged governments to treat the challenge as a long-term structural issue rather than wait for a crisis, pointing to policy responses after the 2008 financial crisis and the COVID-19 pandemic as models. Without that first foothold, he warned, graduates waiting a year compete with the next cohort, and the damage compounds.

"You lose a whole set of intangible attributes, and you lose trust in the future," Shanmugaratnam said. That erosion of trust is already visible in France, where hundreds of thousands of students have protested deteriorating school facilities and demanded greater education funding.

Is everyone bracing for the same tsunami?

Not quite. OpenAI CEO Sam Altman has acknowledged that AI has yet to eliminate entry-level white-collar jobs at the pace he expected. "I'm delighted to be wrong about this," Altman said in a May interview with Commonwealth Bank of Australia CEO Matt Comyn. "I thought there would have been more impact on entry-level white-collar jobs being eliminated by now than has actually happened."

Anthropic CEO Dario Amodei, who previously warned AI could eliminate 50% of white-collar jobs, now offers a more nuanced take on automation. "If you automate 90% of the job, then everyone does the 10% of the job," Amodei said. "And the 10% expands to be 100% of what people do and 10 times their productivity."

President Donald Trump has stayed firmly optimistic, recently declaring the technology should be called "super intelligence." "I think AI is going to be a tremendous job producer," Trump told the New York Times in January, adding there will be "so many jobs" that "we don't have enough people to fill the jobs, and that's where robots come in."

The split matters for practitioners: if Georgieva's 40% figure holds, companies and governments that rebuild entry-level pipelines now — rather than betting on the optimists — will set the terms of the next decade's labor market.

By Nathan Brooks