IMF Managing Director Kristalina Georgieva told a Bangkok audience on Monday that AI is rolling through labor markets like a slow-moving tsunami, with young people entering the job market first in the line of fire. The entry roles that typically build experience are exactly the kind automation can remove. As she put it: "Love it, hate it, or fear it. It [AI] is here, and we are already seeing the first wave of impact." She also warned, "People to worry about, first and foremost, [are] young people that are coming into the labor market," noting that routine, repetitive starter jobs are disappearing and adding, "I don't think any young person wants to be a barista in a coffee shop as ... professional future."
On the same stage, Singapore President Tharman Shanmugaratnam, who co-chairs the World Bank's Jobs Council, argued that the hiring supports rolled out for the Covid-19 response - and earlier during the global financial crisis - ought to be made permanent to help graduates find work. He said the "first rung" after graduation is seeing weaker demand. The tightest squeeze is showing up in tech, he added, pointing to the U.S., where "for the first time in a century, demand for graduates has gone down," alongside a narrowing wage premium for a college degree. Without action, a graduating cohort risks losing more than a year of skills and "you lose trust in the future," he said.
IMF estimates suggest roughly 4 in 10 jobs worldwide could ultimately be reshaped by AI, including being enhanced, downgraded, or erased. The exposure is around 60% in advanced economies and about 23% in low-income countries. That lower share does not mean poorer countries are safer - it reflects that AI adoption is further away.
Even so, AI has been propping up growth this year. Georgieva noted that AI-linked spending and trade have lifted activity in several countries, holding worldwide growth around 3% even as energy supplies were disrupted. Looking ahead, she projected that adopting AI may boost advanced Asia's growth by 0.5 to 1 percentage point and raise emerging Asia's by 0.2-0.8 percentage point. At the top end of those ranges, it could more than offset the drag from aging populations.
The AI policy debate is moving from whether to what to do about it. Market Briefs covers that shift free every weekday.
World Bank President Ajay Banga put the scale in perspective: over the next 15 years, an estimated 1.2 billion young people are expected to reach age 18. Given that the private sector supplies roughly 75% to 85% of all employment in every country, it will have to take in the majority. He said governments can make that possible by investing in infrastructure, establishing clear rules, and reducing risk for private investors so capital can be deployed at scale. "It is private capital that creates jobs," Banga said.
Shanmugaratnam cautioned that growth alone does not guarantee hiring. He pointed to China, India, and developing Southeast Asia as growing quite well even as job creation lags, and warned that AI could widen that gap if policymakers are too passive. The displacement will likely arrive task by task, he said, which buys time provided workers pick up skills while working and universities shift toward applied training.
The people steering the global economy are treating AI as a boost to output and a threat to entry-level hiring at the same time. That means growth can tick up while the first jobs after graduation get harder to land. Expect more talk of permanent youth employment programs, governments working with the private sector, and a bigger push for applied training. For anyone planning a career or building a business, it adds up to a world where productivity gains and hiring do not always move in lockstep.
Mitigation programs are where regulation becomes spending. Join Market Briefs free and follow it.
