Goldman Sachs Warns That Losing Your Job to AI Can Hurt Your Earnings for a Decade

So far, despite a lot of hand-wringing about AI’s risksit’s not exactly clear if it has yet displaced millions of workers from their jobs. In some casesit’s even suspected that when a company claims it’s laid off staff because of AIit’s merely a convenient lie to cover up other uncomfortable business data. But new research from global investment banking giant Goldman Sachs has added a tricky wrinkle to the AI layoffs story, because it suggests that workers who do lose their job to the revolutionary tech can take a long-term earnings hit.

Goldman Sachs economists used data about the impact of previous waves of technological change to inform their analysis, Investopedia reports. The results are grim. Workers who lost their job due to a revolutionary innovation ended up suffering longer periods without work, earned less money, and even went through typical life-changing events like starting a family later than people whose jobs weren’t displaced by the tech.

In fact, people laid off in this way ended up with wages that were three percent lower (adjusted for inflation) when they eventually got new jobs—and it’s possibly due to a perception that the skills they possess were worth less now. The effects were also “sticky,” with salary impacts lasting 10 years. In that period their salary grew 10 percentage points less than people who hadn’t been laid off. And, showing that the effect is directly related to the tech revolution, their salaries also grew 5 percentage points less than people who were laid off for different business reasons.

The impact of a tech-related layoff was felt more acutely for older workers than entry level staff, Goldman’s report noted. The authors wrote that even though there’s ongoing concern about AI’s impact on the entry level job market, “younger workers have actually been able to adjust more flexibly through occupational mobility and skill upgrading in the past.” Goldman’s data, though related to previous revolutionary tech waves, is applicable to AI and may indicate that if you lose your job to AI it’ll be harder for you to recover than if you’re laid off for other reasons.

That data is critical, as another recent report highlights exactly how much AI is being used in the workplace already. Data from San Jose-based AI game testing company Epoch AI and market research outfit Ipsos revealed that one in five full-time U.S. workers have already given over parts of their job to AI systems.

Fully half of the respondents to the survey had used AI in the previous week for work or personal reasons. And, perhaps concerningly, 15 percent said that AI tech had actually created more daily work chores that they otherwise wouldn’t have had to tackle, Futurism.com reported. That tallies with a couple of earlier reports that suggest AI sometimes costs workers time instead of saving it.

NBC spoke to Nichols Miailhe, AI policy leader at the Global Policy on Artificial Intelligence, about the data and he highlighted that the research hints AI isn’t so much “augmenting” workers (as AI boosters argue) and instead it’s beginning to actually displace humans from their work. “When one in five workers say AI is already replacing parts of their job, we can start talking about labor market restructuring,” he noted, pointing out that AI job displacement should “draw our attention.”