Goldman Sachs Warns AI Is Pressuring Labor Market, Junior Staff Most at Risk

According to the latest research from Goldman Sachs, artificial intelligence is beginning to pressure parts of the labor market, with junior employees appearing to face particularly high risks.
Goldman Sachs released the research on Wednesday, finding that industries with high AI exposure have generally seen weaker hiring growth since 2022. Employment in call centers, software publishing, management consulting, and advertising services has fallen below historical trends, while AI adoption in major developed economies has reached roughly 15% to 20%, according to CNBC.
## AI Pressure Emerges in Certain Sectors
The impact has not been evenly distributed across the labor market. Goldman Sachs found that the information and communication services sector, one of the industries with the highest AI exposure, has seen slower employment growth across several developed economies since 2022.
Call centers have shown the most pronounced weakness. According to the research, employment in the sector is 39% below trend in the U.S., 33% below in Canada, and 27% below in Germany.
Goldman Sachs said the pattern suggests AI-related employment pressure has already emerged in industries where tools capable of automating work are available.
## Junior Employees Face Greater Challenges
Goldman Sachs analyzed employment growth across more than 800 occupations and found that AI-related headwinds have had the strongest impact on junior employees.
The findings align with recent research from Harvard Business School and INSEAD. A study of AI-native startups found that these companies are roughly 25% smaller, have about 15% fewer junior employees and managers, and have approximately 20% more senior-level staff as a share of their workforce compared with similar startups.
The researchers said AI-native companies are using the technology to boost employee productivity and are building AI directly into their products. This has allowed some firms to operate with leaner teams while maintaining valuations similar to traditional startups.
This trend could make it harder for younger workers to break into certain fields if companies increasingly use AI to handle tasks traditionally assigned to junior employees.
## AI Has Not Yet Caused Widespread Job Losses
The Goldman Sachs findings do not necessarily mean the economy is heading toward broad AI-driven unemployment.
A recent analysis from Bank of America found little evidence so far that AI has triggered widespread job destruction in the U.S. economy. Employment in the most AI-exposed sectors has been roughly flat since the launch of ChatGPT, while less exposed sectors have grown about 2%.
Stephen Juneau, an economist at Bank of America, said "AI replaces tasks, not occupations," suggesting that employees may use AI to complete parts of their jobs faster without eliminating entire positions.
Meanwhile, some white-collar and junior positions are showing signs of stress, while construction, manufacturing, and other industries tied to AI infrastructure are creating new demand for workers.
## Companies Continue Hiring in the AI Era
Recent hiring trends also suggest companies are not uniformly replacing workers with AI.
The shift is also visible in junior-level roles. Alphabet Inc. is expected to continue hiring in AI and cloud computing, while CSX Corp. expects modest growth in its train and locomotive workforce. Booz Allen Hamilton Holding Corp. also plans to accelerate hiring after cutting thousands of jobs last year.
These developments suggest companies may be using AI to change how employees work rather than simply eliminating positions. This could create a labor market where fewer junior employees are needed for certain tasks, while demand rises for workers with specialized skills.
## Why AI Costs Still Matter
Economist Steve Hanke takes a more skeptical view of AI-driven unemployment.
In an August interview, Hanke argued that replacing workers with AI on a large scale remains difficult because the technology requires significant electricity, water, computing power, and physical infrastructure. He said, "Companies are not going to fire everyone and replace them with AI."
Hanke's perspective offers a counterpoint to the latest Goldman Sachs research. While Goldman sees measurable labor market pressure in certain industries and among junior employees, Hanke argues that the cost of deploying AI at scale could limit how quickly companies replace human workers.