The New York Federal Reserve reported that rising adoption of artificial intelligence (AI) in its district has so far had a modest impact on employment.
While businesses have increased AI usage significantly over the past year, few have cited layoffs directly linked to the technology, the Fed said in its report.
About 40% of service-sector firms in the region adopted AI last year, up from 25% the previous year, and nearly half plan to implement it in the next six months. Manufacturing companies are also expanding AI integration.
Rather than eliminating positions, AI is prompting retraining and changes to job tasks, according to the Fed.
“Workers tend to collaborate with AI, using it more often to augment rather than automate their tasks,” the Fed noted in its report.
Despite public concern that AI could disrupt hiring, particularly in high-paying professional roles, current labor market effects remain limited.
“The immediate labor market effects remain modest,” the report said, while some companies have even reported adding staff as AI tools enhance productivity.
The Fed cautioned that larger effects on employment may emerge over time as AI becomes more deeply integrated into business operations.
For now, AI appears to be reshaping workflows and prompting skill development rather than triggering widespread layoffs, the report signaled.