Goldman says AI layoffs are leaving 'long-lasting' scar, like the last 40 years

Goldman Sachs finds early evidence that workers displaced from jobs exposed to artificial intelligence face the same persistent setbacks seen in earlier waves of technological change. Since 2025, these workers have taken about a month longer than other displaced workers to find new jobs and have been roughly 10 percentage points more likely to remain unemployed a year later. Workers aged 35 and older have had greater difficulty returning to full-time work than younger workers. The pattern echoes Goldman’s analysis of data dating to 1979: technology-displaced workers experienced slower real earnings growth and elevated unemployment risk for years. Recent government figures also show that older, long-tenured workers are less likely to be working again, and fewer re-employed workers are earning as much as before.

The effects vary by age and background. In past technology shifts, younger, college-educated and urban workers suffered smaller long-term earnings losses; younger workers displaced in the current period have also returned to full-time work faster and moved through fewer temporary jobs. However, separate Stanford research finds employment among 22- to 25-year-olds in highly AI-exposed occupations is about 19% below its expected level, apparently because employers are hiring fewer young workers. Goldman identifies likely AI displacement using occupation exposure, industry adoption and job elimination, since the government survey does not ask whether AI caused a layoff. Its data covers only people who lost jobs, and it is too early to establish broad effects. Displaced workers are more likely to change occupations or industries, yet many - especially older workers - are landing in jobs with similar or higher AI exposure.