The International Monetary Fund (IMF) Managing Director, Kristalina Georgieva, warned that artificial intelligence could wipe out millions of jobs worldwide, but said higher wages for AI-enhanced workers could generate demand that benefits low-wage service employees.
AI Job Losses Threaten Millions
On Friday, speaking on the final day of the World Economic Forum in Davos, Switzerland, Georgieva described AI as a "tsunami" reshaping the labor market, with the potential to transform or eliminate roughly 60% of jobs in advanced economies and 40% globally.
She said the most immediate effects are already visible in high-skilled roles, where AI is boosting productivity and pay.
High-Wage AI Workers Could Boost Service Jobs
"One in 10 jobs is already enhanced [by AI]," Georgieva said. "And the people in these jobs are paid better. When they're paid better, they spend more money in the local economy."
She argued that increased spending by higher-paid workers could create more jobs in local services such as restaurants, retail, and healthcare.
"Demand for low-skilled jobs goes up," she said.
She added, "And actually total employment seems to slightly increase because of it."
However, Georgieva also cautioned that the benefits of AI are unevenly distributed.
She said the "accordion of opportunities" is widening, with the middle class at risk as wages stagnate and entry-level jobs disappear.
"AI is for real and it is transforming our world faster than we are getting a handle," she said.
AI Disrupts Jobs And Career Paths
Earlier, Bill Gates warned that AI was already disrupting jobs and accelerating changes in the labor market, even as he remained optimistic about its long-term benefits.
He said AI was boosting productivity, particularly in software development, and could eventually shorten workweeks, while urging governments to prepare policies to manage disruption and risks beyond employment.
Randstad CEO Sander van't Noordende said AI was eroding entry-level office roles and weakening the traditional college-to-office career path.
He encouraged young workers to retrain and consider skilled trades, service jobs and STEM fields, where demand and wages were growing.
Author Yuval Noah Harari warned that AI would create deeper social challenges, arguing that machines outperforming humans in cognitive tasks could trigger an identity crisis over how people define human value and intelligence.
He also said governments would be forced to decide how far AI systems should be integrated into society, including whether they should be granted legal status to operate, organize or interact in ways similar to humans.
