IMF Warns AI Could Disrupt Jobs and Tax Revenue

International Monetary Fund Managing Director Kristalina Georgieva warned that artificial intelligence is hitting the global labor market like a "slow-moving tsunami," with young graduates first in line, CNBC reports. The IMF estimates that about 40% of jobs worldwide will eventually be "augmented, downgraded or eliminated." Georgieva also said AI risks straining government revenue by tilting the economy toward capital and away from labor, traditionally the main source of tax income, according to a Bloomberg report published by The Japan Times.

Speaking at the annual meetings of the IMF and World Bank in Bangkok, Georgieva said AI is already reducing demand for routine, repetitive work, the jobs young people normally take before moving up the ranks. She said exposure is about 60% in advanced economies and 23% in low income countries.

Singapore President Tharman Shanmugaratnam, who co-chairs the World Bank Jobs Council, called for governments to make crisis era employment support measures permanent and to give companies incentives to hire graduates. World Bank President Ajay Banga told CNBC that "small AI" could create jobs and productivity in middle income and lower middle income countries.

Georgieva estimated that AI adoption could lift growth by 0.5 to 1 percentage point in advanced Asia and 0.2 to 0.8 percentage point in emerging Asia. At the high end, she said, that would more than offset the drag from aging populations.