New research from Goldman Sachs economists reveals AI is having a measurable impact on the U.S. job market, eliminating approximately 16,000 net jobs each month over the past year. The effects are falling disproportionately on Generation Z and entry-level workers.
The analysis distinguishes between AI’s two competing effects on employment: substitution, where AI replaces human workers entirely, and augmentation, where AI enhances worker productivity and may expand hiring opportunities. According to Goldman’s findings, AI substitution accounted for roughly 25,000 job losses per month, while augmentation added back about 9,000 positions monthly.
The research indicates that Gen Z workers face particular vulnerability due to their concentration in routine white-collar and administrative roles that are most susceptible to AI automation, including data entry, customer service, legal support, and billing positions. Without the accumulated experience and specialized judgment that often protects more senior workers, younger employees have less buffer against displacement.
However, Goldman’s economists note that the true aggregate impact of AI may be smaller than their estimates suggest. Their analysis does not fully capture hiring surges related to AI infrastructure investments in areas like data centers, power systems, and construction. It also doesn’t account for incremental labor demand that emerges when AI-driven productivity gains lower costs and expand markets.
The economists observe that while Gen Z represents the generation most fluent with AI tools, the current wave of job displacement is hitting this cohort first and hardest in the roles they typically occupy. The creation of new AI-related opportunities may take longer to materialize and could require different skill sets to access.
For this Fortune report, journalists used generative AI as a research tool, with an editor verifying the information before publication.