"For any young job seekers struggling in today's horrible labor market, experts working for one of the wealthiest companies in the world have a little tough love for you: you're pretty much cooked, fam. In an analysis of recent economic trends in the US, Goldman Sachs economists David Mericle and Pierfrancesco Mei wrote that "jobless growth" is pretty much the new normal."
""The modest job growth alongside robust GDP growth seen recently is likely to be normal to some degree in the years ahead," Mei and Mericle said, according to Fortune, which obtained the note. The two expect that the majority of GDP growth will come from productivity gains boosted by AI progress, with only a "modest contribution" from labor supply growth, or the increase in available workers."
"When it comes to tech innovation, "some transitional friction has been normal historically, and is certainly possible in the future." The effect of all this, Fortune observes, is that hiring in every industry except healthcare has turned net on negative over the past few months, as executives and management teams double down on AI in order to streamline operations and cut out expensive overhead - in the form, mainly, of paychecks."
Recent US economic patterns show robust GDP growth alongside only modest job gains, a dynamic labeled "jobless growth." Goldman Sachs economists expect most GDP expansion to arise from AI-driven productivity improvements, with little contribution from labor supply growth. Historical experience suggests the full labor-market effects of AI may surface during a recession, and transitional frictions remain possible. Hiring has weakened across industries except healthcare as firms adopt AI to streamline operations and reduce payroll costs. Federal Reserve observations indicate younger workers, minorities, and recent graduates face greater difficulty finding employment in a "low-hire, low-fire" market.
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