Impact on Unemployment Uncertain Amid Quickly Advancing Use of AI and Robotics
The morning news on Tuesday, October 28th announced Amazon’s memo to its employees of an overall reduction in the company’s corporate workforce of approximately 14,000 roles, a decision driven in part by Amazon’s “adoption of artificial intelligence (AI) that will result in more cuts next year as well.” The news comes as other companies increasingly embrace generative AI as well as robotics, quickly incorporating the technology into the day-to-day workflow. More than a decade ago, Amazon introduced robots into its warehouses; and although it didn’t spark any concerns at the time, more recently it “represents something much bigger: a seismic shift in how work itself is done” according to the recent article by Economic Times (ET). It has been further noted that “according to internal strategy documents obtained by The New York Times, Amazon now believes it can replace more than half a million jobs with robots over the next decade. Although in 2019 Amazon’s chief robotics technologist reportedly described automation as “a ‘symphony’ of humans and robots, each enhancing the other’s capabilities — machines excel at precision and endurance, but people still dominated in dexterity, creativity, and compassion,” the company “expects to avoid hiring 160,000 workers in the U.S. by 2027” due to increased robotic use. The trend has spread to several of the largest employers in the U.S. over a wide range of industries and the full impact on employment has yet to be determined, but the pace of change is staggering “not just for companies but for countries too.” While some companies such as Walmart, the largest private employer in the U.S. is not eliminating jobs due to “plans to fit 90 million grocery pallets with AI-driven sensors by 2026, but instead “removing monotonous tasks from as many roles possible.” Yet in contrast, the article by ET noted that American logistics firm UPS “aims to close 200 U.S. sorting facilities while building 400 automated ones by 2028.”
Globally, the Future of Jobs Report 2025 released in January by the World Economic Forum projects that “by 2030, macrotrend-driven changes — including AI and automation — will affect roughly 22% of today’s formal jobs,” with the expected creation of 170 million new jobs, while 92 million jobs could be displaced worldwide making reskilling critical. Taking a closer look at the impact of AI adoption on the United States, the August 2025 report How Will AI Adoption Affect the Global Workforce by Goldman Sachs Research notes that “recent commentary by some public companies suggests the labor market is already experiencing effects related to AI, and executives from the technology and finance sectors say they are seeing efficiency gains from generative AI that are sufficient to slow their hiring, especially in operational and back-office capacities.” However, AI adoption continues to remain relatively low, a recent U.S. survey revealing that “only 9.3% of companies reported that they have used generative AI in production during the last two weeks,” thereby limiting the overall labor-market impacts from the technology at this time. Some early signs of employment disruption have appeared in specific industries, and younger tech workers appear to be disproportionately affected. According to statements by Joseph Briggs, who co-leads the Global Economics team in Goldman Sachs Research, and economist Sarah Dong, “until the AI Adoption cycle has fully played out, the potential labor market disruption — including which jobs are likely to be displaced by generative AI — will remain an open question,” but they “remain skeptical that AI will lead to large employment reductions over the next decade.” The Goldman Sachs Research report also projects that if AI is widely adopted, there could be a 6-7% displacement of the U.S. workforce due to innovation related to AI but note that the impact “is likely to be transitory as new job opportunities created by the technology ultimately put people to work in other capacities.”
Source: https://www.goldmansachs.com/insights/articles/how-will-ai-affect-the-global-workforce
Source: https://reports.weforum.org/docs/WEF_Future_of_Jobs_Report_2025.pdf