Workers who lose their jobs to artificial intelligence could face years of reduced pay and slower career growth, according to a new analysis by Goldman Sachs.

AI Job Losses Hit Worker Pay

In a report released Monday, Goldman said its review of 40 years of labor market data shows that workers displaced by technological change often experience long-term financial setbacks, reported Business Insider.

"Our analysis suggests that, similarly to previous waves of technological change, AI-driven displacement could impose lasting costs on affected workers, worsening labor market outcomes for several years," the report said.

The bank found that workers who lost jobs to technology previously took an average 3% cut in real earnings compared with those in more stable occupations. 

Over the next decade, earnings growth for these workers lagged by 10 percentage points compared with peers who never lost their jobs. 

They also took slightly longer to find new employment and faced a higher risk of future unemployment.

Goldman pointed to "occupational downgrading" as a key factor, with displaced workers moving into routine, lower-skill roles because their previous skills were devalued. 

The report added, "The scarring effects also spill over into broader economic outcomes," including slower wealth accumulation and delayed homeownership.

AI Workforce Impact And Job Trends

Last month, OpenAI expanded its workforce amid competition from Anthropic and Alphabet Inc.’s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google and Microsoft Corp. (NASDAQ:MSFT), aiming to nearly double staff to 8,000 by 2026 and enlarge its San Francisco offices.

The hires focused on product development, engineering, research, and sales, following the release of advanced AI models for coding, analysis, and media generation.

JPMorgan Chase CEO Jamie Dimon said AI could eventually shrink the work week to four days, noting the bank had 600 AI use cases across fraud detection, risk management and marketing.

He predicted rising productivity and breakthroughs in health care and other industries while cautioning about potential job losses and stressing the need for reskilling programs.

Billionaire Mark Cuban is also comparing the AI revolution to the personal computer era, and urged workers to embrace new tools quickly.

He highlighted that while AI learning could be intimidating, accessible online resources gave workers a chance to gain new skills and remain competitive in a rapidly changing job market.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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