New York Fed Says AI Reshapes Skills, Not Jobs, as 40% of Service Firms Adopt It
Updated
Updated · Liberty Street Economics - · Aug 5
New York Fed Says AI Reshapes Skills, Not Jobs, as 40% of Service Firms Adopt It
1 articles · Updated · Liberty Street Economics - · Aug 5
Summary
Few firms are cutting jobs because of AI, with New York Fed research finding the technology is changing hiring and skill needs more than triggering layoffs.
40% of service firms and 26% of manufacturers reported using AI in 2025, up from 25% and 16% in 2024, while some employers cut routine hiring and others seek AI-proficient workers.
Retraining is the dominant response: firms told the Fed they overwhelmingly plan to prepare existing workers for AI-related tasks rather than replace them.
Athreya said the bigger risks may emerge over time if specialized skills lose value suddenly or if AI shifts demand toward status-driven consumption, even as labor effects remain muted so far.