AI Like a Tsunami for Jobs Market, Warns IMF Chief Kristalina Georgieva

Artificial Intelligence is rapidly transforming the global workforce, and its impact could be as powerful and disruptive as a tsunami, according to International Monetary Fund Managing Director Kristalina Georgieva. She warned that while AI has the potential to boost productivity, growth, and incomes, it could also deepen inequality and disrupt labour markets if governments fail to act quickly.

Speaking about the accelerating pace of technological change, Georgieva said AI is already reshaping how people work and live. Unlike previous technological shifts, the speed of AI adoption is unprecedented, making it essential for countries to adapt swiftly or risk falling behind.

AI transforming work at record speed

Georgieva emphasised that AI is no longer a future concept — it is already embedded in workplaces and daily life. She described the transformation as the fastest technological shift in history, noting that governments and businesses must move boldly to harness its benefits.

While AI can significantly increase productivity and economic growth, it also presents serious challenges. Automation and intelligent systems can replace certain tasks, forcing workers to adapt to new roles or acquire new skills.

40% of jobs globally could be affected

According to IMF estimates, around 40% of jobs worldwide could be affected by AI in the coming years. In advanced economies, this figure could reach as high as 60%.

However, Georgieva clarified that “affected” does not always mean job losses. In many cases, AI will enhance efficiency and productivity, leading to better-paying roles. At the same time, some jobs may disappear or undergo major transformation.

She noted that in the United States, one in ten jobs already requires AI-related skills. These positions often offer higher wages, which can stimulate consumer spending and create demand in service sectors such as hospitality and entertainment. Despite overall employment growth in some areas, many new jobs are low-paying, contributing to widening income gaps.

Middle-income jobs under pressure

Georgieva warned that the biggest strain is being felt in middle-income roles. High-skilled workers are benefiting from AI-driven demand and higher pay, while low-skilled service jobs continue to exist. However, mid-level positions are shrinking, creating pressure on a large segment of the workforce.

Automation is also reducing entry-level opportunities, making it more difficult for fresh graduates to enter the job market. This trend is contributing to growing anxiety among young professionals.

Policy action is essential

Despite the risks, Georgieva stressed that governments have the tools to manage the transition effectively. She identified two priority areas: education reform and stronger social protection.

Education systems must evolve to prioritise lifelong learning and adaptability. Workers need to continuously upgrade skills to remain relevant in an AI-driven economy. She highlighted that the ability to “learn to learn” will be critical in the future workforce.

At the same time, governments should strengthen social safety nets to support workers during job transitions. She cited Denmark’s labour model as an example of balancing flexibility for employers with strong security for workers. She also welcomed labour reforms in India, noting that flexibility should be paired with worker protection.

Balancing opportunity and risk

Georgieva concluded that AI presents both enormous opportunity and serious risk. It can accelerate growth and raise incomes, but without careful management, it could increase inequality and social instability.

The challenge for policymakers worldwide is to act early, stay flexible, and ensure that the benefits of AI are widely shared rather than concentrated among a small segment of society.