Fewer graduate roles, more retraining
New research from the Federal Reserve Bank of New York reveals a nuanced picture of AI's impact on employment. While widespread layoffs due to AI remain uncommon, businesses are increasingly reducing hiring, particularly for roles requiring university degrees.
The survey of firms in the New York region found that 40% of service companies now use AI (up from 25% last year), yet only 1% reported AI-induced layoffs. However, 12% of AI-using service firms admitted to hiring fewer workers due to AI implementation, with these reductions concentrated among graduate-level positions. This trend may partially explain recent challenges facing new graduates in the job market.
For existing employees, AI is driving retraining rather than replacement. Over a third of service firms using AI are retraining workers to adapt to the technology, suggesting that upskilling is central to career resilience in an AI-integrated workplace.