IMF warns: AI is reshaping 40% of jobs, youth employment is getting cold

According to Woofun AI, International Monetary Fund Managing Director Kristalina Georgieva issued a double warning at the Bangkok annual meeting: although artificial intelligence boosts the economy, it will impact 40% of jobs, with young people bearing the brunt.

Investments in artificial intelligence are offsetting the negative effects of ageing and driving the world economy to grow at a rate of about 3% per year. The speech was delivered on the opening day of the annual meeting between the International Monetary Fund and the World Bank, which will continue until October 18. Georgieva pointed out that Asian economies are the biggest beneficiaries. AI technology can increase the GDP growth rate of developed economies by 0.5 to 1 percentage point per year, and that of emerging economies by 0.2 to 0.8 percentage points. It needs to be clarified that 1 percentage point represents the difference in growth rate, that is, if the original growth rate was 2%, the actual growth rate reached 3% after increasing 1 percentage point.

This increase is sufficient to hedge against demographic pressure. According to data compiled by Woofun AI, the July report indicates that the four largest net exporters of AI hardware, Taiwan, South Korea, Thailand, and Malaysia, all surpassed the first-quarter forecast, with an average year-on-year growth rate of 4.4%; among them, South Korea's growth rate reached 7.5%, far exceeding the 1.8% forecast in April. In her speech in Singapore, Georgieva said that AI hardware and related products account for more than one-tenth of the total global commodity trade, and the scale of investment is expected to surpass railway or power grid construction.

However, energy prices have risen due to the war in the Middle East. The July update lowered the global economic growth forecast for 2026 to 3%, down from 3.5% in 2025, and the technological boom is bypassing most countries outside the supply chain.

Georgieva likened artificial intelligence to a “slow-moving tsunami,” and it is expected that it will eventually affect about 40% of the world's jobs, leading to replacement or weakening of functions. In developed economies, the impact was about 60%, while in low-income countries it was about 23%. The latter share was lower mainly because technology was not widely available. Young people who are about to enter the labor market are bearing the brunt, as AI is replacing the routine jobs required for entry-level jobs. Speaking at the same seminar, Singaporean President Shandaman pointed out that first-time employment opportunities for graduates are already declining, warning that AI may further widen the gap between developed economies and developing countries if the government does not act.

Artificial intelligence may also put pressure on public finances, as it shifts revenue from workers to capital owners, leading to the loss of the government's tax base. World Bank President Ajay Banga said the bank is supporting 'small artificial intelligence' tools designed for farmers, clinics and schools in emerging markets that do not rely on big language models. In her speech in Singapore, Georgieva pointed out that the development of AI technology itself is also driving up inflation, and warned that major AI companies are borrowing heavily to develop technology, and that poor financial performance may spread from market to market. The International Monetary Fund will release the “World Economic Outlook” report on October 13 at 9 a.m. Bangkok time (10 p.m. New York time on Monday). This is the first revision of the 3% global economic growth forecast since July.