AI Cuts Hiring Demand by Nearly 10% in Exposed Jobs, but New Skills Are Opening Career Pathways

An IMF study covering 110 economies finds that AI has reduced hiring demand in highly exposed occupations by nearly 10%, even as the negative impact stabilizes despite technological advances. Rising demand for AI skills is creating new job opportunities, highlighting the urgent need for workforce reskilling, digital education and policies that support adaptation to AI-driven employment changes.

Artificial intelligence is transforming global labor markets by reducing recruitment in occupations vulnerable to automation while creating new employment opportunities for workers with advanced technological skills, according to research by the International Monetary Fund (IMF) and the University of Chicago. The study, titled How is Labor Demand Changing as AI Improves? New Global Evidence, was conducted by Sakai Ando, Divya Kirti, Willa Lin and Assyifa Szami Ilman. Analyzing approximately 700 million online job advertisements across 110 economies between November 2021 and April 2026, the researchers found that demand for workers in occupations highly exposed to artificial intelligence declined by nearly 10% relative to less-exposed occupations. However, despite rapid improvements in AI capabilities, the negative impact on recruitment has largely stabilized, suggesting that businesses are increasingly changing workplace responsibilities rather than continuously eliminating jobs.

AI Is Reducing Recruitment, but Job Losses Are Not the Whole Story

The researchers examined recruitment data collected by Lightcast, covering approximately 340 occupations across 20 industry categories. They compared employment demand before and after the November 2022 launch of ChatGPT while accounting for economic conditions, industry trends and remote-working arrangements.

The findings show that recruitment in highly AI-exposed occupations weakened during 2023 and 2024. The preferred statistical model estimates an average decline of approximately 6% in job advertisements relative to less-exposed occupations, with the reduction approaching 10% toward the end of the study period.

Importantly, these figures represent reduced demand for new employees rather than actual job losses. Existing workers may remain employed even as businesses advertise fewer positions, meaning the broader employment consequences could emerge gradually.

One surprising finding is that improving AI capabilities have not caused continuously worsening recruitment declines. Using benchmarks developed by the nonprofit research organization METR, researchers found that the negative effect largely stabilized after AI systems became capable of completing tasks requiring approximately one hour of human effort. The estimated decline remained around 8% despite further technological advances.

Advanced Economies Face Greater Risks as AI Reshapes Jobs

The study reveals significant differences in how artificial intelligence affects employment across countries and occupations.

Advanced economies experienced the strongest negative recruitment effects, while emerging market economies recorded smaller reductions. In low-income economies, the estimated impact was statistically insignificant. Across the IMF's Asia and Pacific regional sample, recruitment in highly exposed occupations declined by approximately 6% to 7%.

The research also found that occupations involving tasks easily performed by AI face greater risks than jobs requiring human judgment, communication, responsibility and critical thinking.

Globally, occupations combining high AI exposure with limited opportunities for human-AI collaboration experienced estimated recruitment declines of approximately 9.5%. In comparison, highly exposed occupations where AI could support human workers recorded smaller reductions of around 4.7%.

However, the researchers found little consistent statistical evidence that junior employees were more severely affected than senior workers. They also found no statistically significant changes in advertised average or median wages associated with AI exposure during the study period.

These findings suggest that the consequences of automation depend not simply on whether AI can perform workplace tasks, but also on whether technology can complement human expertise.

Demand for AI Skills Is Creating New Employment Opportunities

While artificial intelligence is reducing recruitment in some occupations, it is simultaneously creating demand for new technological skills.

The researchers identified 51 emerging AI-related skills, including prompt engineering, AI agents, ChatGPT, Microsoft Copilot, retrieval-augmented generation and vector databases.

Demand for these skills has increased rapidly since 2023, particularly in occupations already considered highly exposed to automation.

Recruitment advertisements demonstrate how these requirements are spreading across industries. Employers in Sri Lanka sought workers capable of using AI in auditing and risk management, while companies in China required AI-assisted software development expertise. Financial institutions in Malaysia advertised positions involving AI model validation, and businesses in Mexico sought engineers capable of developing generative AI systems.

The findings indicate that employers are increasingly redesigning existing positions to incorporate artificial intelligence rather than simply replacing workers.

AI-Adopting Companies Are Hiring Faster, Raising Policy Challenges

The study examined recruitment patterns involving more than 560,000 firms and found that businesses advertising positions requiring emerging AI skills generally experienced faster growth in job postings than companies without such requirements.

This positive relationship remained evident even in occupations highly exposed to automation, suggesting that AI adoption can accompany employment expansion.

However, adoption remains uneven. Larger businesses were more likely to advertise AI-related positions, while fewer than 20% of even large companies met the researchers' recruitment-based definition of AI adoption. The study cautions that businesses may use AI without hiring specialists, meaning actual adoption could be considerably higher.

For governments, these developments highlight the importance of strengthening digital education, vocational training and workforce reskilling programmes. Employers face pressure to invest in technological capabilities while helping existing employees adapt to changing responsibilities.

The study concludes that artificial intelligence is producing two opposing employment effects: reducing recruitment in vulnerable occupations while creating opportunities for workers with emerging AI skills. Its long-term consequences will depend on how effectively businesses integrate technology and how successfully workers acquire the capabilities needed in an increasingly AI-driven economy.