International Monetary Fund Managing Director Kristalina Georgieva warned Tuesday that artificial intelligence is impacting the global labor market "like a tsunami" during remarks at the World Economic Forum in Davos, emphasizing that most countries and businesses remain unprepared for the workforce disruption already underway. The warning comes as new data reveals employee anxiety about AI-driven job loss has surged to 40% in 2026, up from just 28% two years earlier.
Speaking in conversation with CNBC's Karen Tso and Steve Sedgwick, Georgieva acknowledged AI's potential to boost economic growth by up to 0.8% over coming years but stressed the technology's disruptive impact on employment demands urgent attention. "AI is a major factor for economic growth," Georgieva stated. "We see potential to up to 0.8% boost to growth over the next years, but it is hitting the labor market like a tsunami, and most countries and most businesses are not prepared for it."
IMF Calculates 40% of Jobs Globally Affected
The IMF calculates that on average, 40% of jobs worldwide are being touched by AI—either enhanced, eliminated, or changed significantly without implications for better compensation. This transformation spans both developed and emerging economies, though Georgieva expressed concern about the uneven distribution of opportunities. "The world as a whole is already experiencing the arrival of AI, but I do worry about the accordion of opportunities that are much more present in some places than in others," she explained.
The remarks highlight a fundamental tension in AI's labor market impact. While AI demonstrably boosts productivity in translation, interpretation, and research analysis—representing enhancement rather than replacement—many communities lack access to these tools entirely. This geographic and economic disparity threatens to exacerbate existing inequalities as AI adoption accelerates globally.
Employee Anxiety Reaches Record Levels
New data from consultancy firm Mercer's Global Talent Trends 2026 report, based on surveys of 12,000 people worldwide, reveals that employee concerns about AI-driven job loss have jumped from 28% in 2024 to 40% in 2026. More troubling, 62% of employees feel their leaders underestimate AI's emotional and psychological impact on workers, suggesting a disconnect between executive enthusiasm for AI adoption and workforce readiness.
"Anxiety about AI will go from a low hum to a loud roar this year," Deutsche Bank analysts wrote in a Tuesday note. "This will be reflected in lawsuits over everything from copyright to privacy, data centre location and protection of young people from chatbots encouraging self-harm or worse." The bank's analysis cited a Stanford University study from November referencing a 16% relative decline in employment for graduates in roles exposed to AI, while jobs for experienced employees have remained relatively stable since ChatGPT's November 2022 launch.
AI Redundancy Washing Complicates Assessment
Deutsche Bank analysts warned that companies attributing job cuts to AI should be taken "with a grain of salt," predicting that "AI redundancy washing will be a significant feature of 2026." This practice involves companies citing AI as justification for layoffs driven primarily by other factors such as economic uncertainty or cost-cutting initiatives unrelated to automation capabilities.
Sander van't Noordende, CEO of Randstad, the world's largest staffing firm, pushed back against narratives linking current layoffs directly to AI during his Davos appearance Tuesday. "I would argue that those 50,000 job losses are not driven by AI, but are just driven by the general uncertainty in the market," Noordende told CNBC. "It's too early to link those to AI."
This assessment aligns with research from Yale University's Budget Lab, which analyzed U.S. labor market data from 2022 to 2025 and found that AI hasn't yet caused widespread job losses. The October report concluded that the share of workers in different job categories hadn't shifted massively since ChatGPT's debut, suggesting labor market impacts remain more limited than public anxiety suggests.
Georgieva emphasized that countries and companies must prioritize workforce development to navigate AI's transformative impact successfully. "What do they need to do? They need to think about the new skills that are already necessary and how they're going to have these new skills," she stated, calling for systematic upskilling opportunities and education programs to bring workers along through the transition.
The IMF chief's remarks occurred during a panel that included Brad Smith, Vice-Chair and President of Microsoft; Khalid Al-Falih, Saudi Arabia's Minister of Investment; and Ashwini Vaishnaw, India's Minister of Electronics and Information Technology. The discussion reflected growing recognition among global leaders that AI governance and workforce preparedness require coordinated international responses rather than fragmented national approaches.
For businesses and policymakers attending Davos, Georgieva's warning underscores that AI's economic benefits cannot be realized without addressing workforce displacement, skills gaps, and the psychological toll on workers facing uncertain employment futures. The "tsunami" metaphor suggests urgency—workforce adaptation strategies implemented today will determine whether AI's economic gains are broadly shared or concentrated among those positioned to capture automation's benefits while others face displacement.
