---
id: "lib-2026-08-05-ai-s-impact-on-labor-and-hiring"
type: "library"
title: "AI's Impact on Labor and Hiring"
lang: "EN"
org: "Unknown"
source_type: "Report"
date: "2026-08-05"
week: "2026-W32"
url: "https://nosov.ai/library/lib-2026-08-05-ai-s-impact-on-labor-and-hiring/"
original_url: "https://libertystreeteconomics.newyorkfed.org/2026/08/ais-impact-on-labor-and-hiring/"
tier: "B"
tier_name: "Useful, limited"
tier_reason: "Thematic post by the New York Fed's research director that recaps the bank's own business and consumer surveys; credible institutional context with no new data or analysis of its own."
summary_basis: "full-text"
original_minutes: "6"
tags: ["labor market", "hiring", "firm survey"]
---

# AI's Impact on Labor and Hiring

Tier B (Useful, limited): Thematic post by the New York Fed's research director that recaps the bank's own business and consumer surveys; credible institutional context with no new data or analysis of its own.

Summary based on the full text.

## In short

The first post (5 August 2026) in "Street Level", a series by Kartik Athreya, research director at the Federal Reserve Bank of New York, that summarises the bank's research on a theme. The theme here is AI and hiring. His reading of the bank's surveys: adoption is rising fast, AI-driven layoffs are rare, and the effect so far shows up in changed skill requirements and slower hiring plans, especially for graduates. He closes with two risks of his own: narrow specialisation leaves workers exposed to a sudden fall in the value of their one skill, and AI may tilt demand toward status-driven, zero-sum consumption.

## Key numbers

- 25 to 40: percent of New York-region service firms using AI, 2024 to 2025 (44 expected in the next six months)
- 16 to 26: percent of New York-region manufacturers using AI, 2024 to 2025 (33 expected in the next six months)

## What it reports

- New York Fed regional business surveys (August 2025): AI use rose from 25% to 40% of service firms and from 16% to 26% of manufacturers between 2024 and 2025, with 44% and 33% expected within six months.
- Firms report very few AI-driven layoffs; they expect to reduce hiring plans, especially for college-educated workers.
- Some firms hire less because AI automates tasks; others hire more AI-proficient workers.
- Firms overwhelmingly say they intend to retrain rather than dismiss staff as they adopt AI.
- An October 2024 New York Fed analysis found that people exposed to generative AI tools held bleaker expectations for job availability and income inequality.
- Cites Garicano and coauthors on jobs as bundles of tasks, where automating some tasks frees teams for others.

## How they got it

A synthesis of earlier New York Fed survey posts (regional business surveys, Survey of Consumer Expectations) and outside papers, plus the author's own commentary. No new data or method is introduced.

## Limits

- Survey results are self-reported intentions of firms in one Federal Reserve district.
- The retraining chart is described but its values are not given in the text.
- The demand-side argument about status consumption is explicitly speculative.
- Views are the author's, not the Federal Reserve's.

## Why it matters for companies

The useful message for workforce planning is where the effect lands first: hiring plans and skill mix, not layoffs. If firms in the survey are right, entry-level and graduate intake is the exposed margin, and stated retraining intentions will need budget to become real. The specialisation point is also practical: roles built around one narrow task are the ones whose value can drop fastest, which argues for broadening job designs before AI does it for you.

Original: https://libertystreeteconomics.newyorkfed.org/2026/08/ais-impact-on-labor-and-hiring/