Workers are Worried, but There's no Sign AI is Muscling People Out of Their Jobs on a Massive Scale

Mark Zuckerberg says we're lucky to live in an 'incredible moment,' but many workers are having a hard time stomaching the uncertainty

Workers are trying to understand where they stand with AI's rise in the workplace.

Carl Webb has been underslept and over-stressed recently, but he's got a plan.

The Austin, Texas, man is working night shifts at an IRS processing center. His seasonal job is winding down, and the tax collector's leaders have said they want to incorporate more technology into their operations - as have many corporate executives.

After four or five hours of sleep, Webb attends a community-college course on semiconductor manufacturing. His plan is to find work maintaining chip-building equipment, as semiconductors are essential to the rise of AI, Webb explained.

"I don't want to be one of the people automated out the workforce. I guess I have to be a techie. I hope I'm one of the techies they need," Webb, 61, told MarketWatch.

'I don't want to be one of the people automated out the workforce. I guess I have to be a techie. I hope I'm one of the techies they need.'Carl Webb, Texas resident taking coursework on semiconductor manufacturing

Like Webb, many people across the country are wondering where they stand in an AI-powered economy.

Their insecurity about AI's impact on their livelihoods is growing. For instance, 2026 is the first year that workers' negative discussions about AI outnumbered the positive ones on the job-search site Glassdoor. The pessimism focuses on AI potentially leading to layoffs and less hiring.

User talk of AI "has really surged and become a top concern for workers," Glassdoor's chief economist, Daniel Zhao, told MarketWatch.

But in a job market filled with competing signals, this is a big one: Workers' worries about losing a job to AI don't match the scale of AI displacement that does seem to be occurring.

So far, at least.

At the margins, there are some signs of AI-induced layoffs and fewer jobs for younger workers in AI-exposed roles. On the whole, however, economists say there's no sign AI is muscling people out of their jobs on a massive scale.

Wall Street investors and C-suite executives are bullish on AI's rise. Meta Platforms CEO (META) Mark Zuckerberg has emphasized his AI optimism, opening a Monday essay by saying "we are fortunate to live at an incredible moment in history."

Yet many workers aren't so sure; they're having a hard time stomaching the uncertainty.

What the job numbers say

The economy unexpectedly lost 23,000 jobs in July, the Bureau of Labor Statistics said Friday. Don't read too much into that, said Adam Schickling, senior economist at Vanguard.

Economists at the asset-management giant were expecting "spring strength, followed by summer softness" because of factors like the World Cup hiring spree.

Information and professional services are more likely to be the places where AI disruption would show, he said. The July jobs data showed little change in those industries month over month.

"I'm not saying concern is invalid. It's not something having a material effect at the moment," he said. What's most likely, in Schickling's view, is that the total number of workers doesn't decline in the coming five to 10 years - but there will be a big change in the types of work and skills employers want.

In the big picture, AI's impact on job numbers has been "very muted right now," said ADP Chief Economist Nela Richardson.

The occupations most exposed to AI's reach shrank by 0.2% year over year in June, according to research from ADP and Stanford University. The least-exposed jobs grew by 0.6% in the same period.

Last week, the ADP jobs report showed employers added 44,000 new jobs in July. Over half were in the information sector, financial services, and professional and business services.

Those are three areas of the job market where AI replacement would conceivably show, Richardson noted. "We're not seeing it this month," Richardson said about the payroll giant's July job numbers.

At Revelio Labs, researchers looked at how much companies have embraced AI, based on the skills and titles sought in job postings. Since ChatGPT arrived in late 2022, AI adopters have increased headcount by 27% more than non-adopters.

By that view, businesses see AI as a way to do more with more. Corporate leaders overwhelmingly see AI as a boon for productivity, according to Federal Reserve Bank of St. Louis analysts who looked at almost half a million earnings calls since late 2022.

On Monday, Zuckerberg said history is filled with technological change - and adapting can be challenging. Having widespread access to AI and gaining AI skills will smooth the change, he wrote.

"Company sizes may shrink - just as they did in the transition from industrial giants to tech companies. But this doesn't mean fewer jobs overall. It implies a larger number of companies with fewer people each. There are many more valuable companies and services to build than people are able to build today," Zuckerberg wrote.

The businesses may become more productive - but who are the people becoming more productive thanks to AI? The early clues show an uneven story, and that could help explain workers' worries.

At firms that leaned into AI, senior-level roles jumped 31%, while junior-level roles increased by 6%, Revelio Labs found.

It was even more dramatic for ADP and Stanford Digital Economy Lab researchers. A shrinking number of people in their early to mid-20s are working in AI-exposed jobs, they said.

The contraction has lasted for 33 straight months, and now there are roughly 4% fewer workers in their early 20s in those jobs. The same shrinkage happened for workers in their late 20s, but on a smaller scale.

Meanwhile, employment was flat year over year - rather than shrinking - for early-20s workers with jobs that were the least exposed to AI, researchers said.

Vibe shift

Then there's the way that many rank-and-file workers see AI. More than half of workers now use AI at least occasionally at work, according to Gallup, often for writing and editing or research.

Nevertheless, many people take a wary view of the technology that's helping them dash off an email.

Two-thirds of workers say AI will damage the workplace, according to a poll from the Groundwork Collaborative, a progressive economic-policy think tank. The technology will either lead to layoffs or put more pressure on workers to produce more, the two-thirds said.

Lower-paid workers with less formal schooling tend to have the dimmest views, the poll showed. Four in 10 people making at least $100,000 said AI will improve their job. Yet just 19% of people making under $50,000 said AI will help their job.

Four in 10 job seekers said AI is harming their line of work, according to the poll.

Read also: AI is killing the cover letter - but here's when it still pays to send one

Workers' moods were already precarious without AI. Many people are sticking with their current job, knowing that unemployed workers have to trudge through job hunts that last for months.

Last month, Glassdoor's index of employee confidence hit a new low. The gauge measures what workers think of their employer's business outlook in the coming six months, but it's also a reflection of how they are feeling about their future prospects.

"Workers are constantly anxious about layoffs. They are worried about when the next shoe is going to drop," said Zhao. The recent dip in confidence may have more to do with inflation, he said. Still, "AI is absolutely a part of this as well."

The layoff rate happens to be extraordinarily low right now. But it doesn't take much for workers to doubt their prospects, Zhao said.

"Workers see the headlines, hear about their friends. Crucially they hear about workers having incredibly hard times getting back into jobs, which amplifies the risk of being laid off," he said.

Last month, employers announced more than 33,000 layoffs, according to Challenger, Gray & Christmas. That's a drop from June and from the same point a year ago.

But for the fifth straight month, companies said AI was the top reason for their layoffs. It was the explanation for one-third of the pink slips. AI has accounted for nearly 113,000 layoffs this year. That's around one-quarter of the job cuts tracked by the firm.

The pace of layoffs has fallen "dramatically this summer," said Andy Challenger, chief revenue officer for Challenger, Gray & Christmas. The plans are clustered in the tech sector, and AI investment is "still the story."

At the same time, employers are announcing plans to hire more workers, he said. "So while AI is shifting the labor market, it is not dismantling it."

So AI's threat to jobs may be modest now, but it's enough to linger in people's minds.

Just ask Temitayo Ogunduyilemi, a Baltimore-based industrial engineer working with bio-medical supply chains.

There are ways he could use AI at work, such as generating charts, spreadsheets and data reports. Yet the 27-year-old intentionally doesn't use the technology. "I'm a little old school. I would look it up and figure it out."

Ogunduyilemi said he doesn't fear AI coming for his job. Supply-chain management involves human judgment when unplanned snags arise, he said. "I just keep it in the back of my mind," he told MarketWatch.

That's part of why he skips AI prompts to learn for himself. "If I have the skill myself, that puts me in a position where I'm not necessarily outsourced."

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-Andrew Keshner

MW Workers are worried, but there's no sign AI is muscling people out of their jobs on a massive scale

By Andrew Keshner