IMF warns young workers face first wave of AI disruption

International Monetary Fund (IMF) Managing Director Kristalina Georgieva cautioned on Monday in Bangkok that young people bear the greatest risk of job displacement from AI. She added that the routine entry-level positions that typically start careers are vanishing first.

Georgieva anticipates that AI will ultimately affect roughly 40% of global jobs. However, the IMF's research on the US indicates net job creation, primarily in lower-wage positions.

What Makes Young Workers the Most Vulnerable?

During the IMF and World Bank Annual Meetings, Georgieva likened AI to a slow-moving tsunami that nonetheless strikes.

According to the IMF, approximately 60% of jobs in advanced economies will be affected, compared with 23% in low-income nations. Georgieva said that poorer countries only appear safer because AI has yet to reach them.

At the same time, IMF research in the US shows routine jobs declining. The majority of new jobs are lower-paid positions in data centers and services, mirroring a caution from Mark Cuban regarding the beneficiaries.

“The people to worry about first and foremost young people that are coming into the labor market. Normally they would get into this routine repetitive jobs and then grow up the ranks but if they’re gone I don’t think any young person wants to be a barista in a coffee shop…”

Kristalina Georgieva, IMF Managing Director, said.

Is the Entry-Level Career Step Collapsing?

Speaking on the same panel, Singapore's President Tharman Shanmugaratnam highlighted the situation in entry-level hiring.

“The first rung in employment, your first job upon graduation, is now seeing less demand. The evidence is already very clear. It’s clearest in the most AI exposed sectors, by the way, which are the tech sectors.”

Tharman Shanmugaratnam, President of Singapore, said.

Tharman argued that losing that first job costs more than a year of skill development. It also undermines confidence in the future.

Payroll data supports his worry. Among the most AI-exposed occupations, employment for those aged 22 to 25 dropped by approximately 12% from November 2022 to April 2026.

By contrast, that age group saw a roughly 7% increase in the least-exposed positions. Workers aged 31 and over exhibited virtually no difference, per Stanford and ADP data.

The researchers attribute the decline to reduced hiring rather than increased firings.

A U.S. Census Bureau working paper from September found that starting salaries for the majors most exposed to AI declined by 13%. Roughly half of that decrease stemmed from graduates shifting to restaurants, retail, and other lower-wage industries.

Does a College Degree Remain a Reliable Investment?

Tharman also noted that demand for college graduates in the US has fallen for the first time in 100 years.

Data from the Federal Reserve Bank of New York points in the same direction. In June 2026, recent graduates faced unemployment of about 5.7%, compared with roughly 4.1% for all workers.

Historically, recent graduates had lower unemployment rates than the general workforce. That pattern reversed starting in 2018. The gap reached 1.8 percentage points in April 2025, the largest since at least 1990.

Alert or Overreaction?

Stanford's researchers describe their findings as descriptive, not as evidence that AI caused the drop. Others, such as Andreessen Horowitz partner David George, argue that the narrative of an AI-driven job apocalypse is unsupported.

Despite that, Tharman called on governments to make pandemic-era hiring assistance permanent and offer incentives for companies to hire new graduates.

Georgieva acknowledged that no one can foresee the labor market five years from now. For those entering it currently, the hiring data already reveals initial cracks.