IMF MD says AI to affect 40% of global jobs as World Bank shifts focus to job creation, productivity through AI, 

The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, says AI could affect about 40 per cent of jobs globally and urges governments to prepare workers for a changing labour market.

Meanwhile The World Bank Group said it is prioritising job creation and productivity, using AI to expand economic opportunities in developing countries. 

World Bank president Ajay Banga said this during a discussion on ‘Small AI: More and Better Jobs’ at the 2026 International Monetary Fund/World Bank annual meetings in Bangkok, Thailand, on Monday. Mr Banga stressed the need to make technology accessible and relevant to local economies. He said about 1.2 billion young people would turn 18 within the next 15 years, allowing countries to harness their demographic potential through productive employment.

According to him, realising this potential requires investments in healthcare, education, clean water, electricity and skills development, alongside opportunities for young people to contribute meaningfully to society.

Mr Banga explained that employment should not be limited to jobs in large or small companies but should include entrepreneurship and other productive activities that promote dignity and economic inclusion. He said the World Bank’s development approach now prioritised job creation, with infrastructure, governance reforms and policies designed to attract private investment.

Ms Georgieva ‌and Banga said this during a panel discussion on ‘Small Scale AI: More and Better Jobs’ at the 2026 IMF/World Bank Annual Meetings in Bangkok, Thailand.

Ms Georgieva described AI as a “slow-moving tsunami” for the labour market, saying it could augment, downgrade or eliminate jobs.

According to her, IMF estimates show that AI could affect about 60 per cent of jobs in advanced economies and 23 per cent in low-income countries.

She said the lower exposure in low-income countries reflected the slower spread of AI rather than greater protection from its effects. According to her, AI is already stimulating investment and demand in some economies through data centre construction and AI model development.

She identified the United States, China and India as major AI-producing economies, while several Asian countries, including Thailand, were contributing to the infrastructure supporting the technology.

Ms Georgieva said the investments were helping sustain global economic growth at about three per cent, despite the drag from energy supply shocks.

She, however, said the next phase of AI development would be driven by adoption, which could enable more countries to benefit if they established the necessary foundations. The IMF chief said developing economies needed reliable electricity, digital infrastructure, appropriate skills and effective government safeguards to ensure safe and inclusive AI adoption.

She cited IMF estimates indicating that AI could increase growth in advanced Asian economies by between 0.5 and one percentage point, while emerging Asian economies could record additional growth of between 0.2 and 0.8 percentage points.

Ms Georgieva said an additional one percentage point of growth could more than offset the economic losses associated with rapidly ageing populations in advanced Asian economies. On employment, she said an IMF study in the United States showed that about 10 per cent of jobs already required advanced AI skills, with such positions generally attracting higher pay.

She added that routine and repetitive jobs were declining, while lower-paying jobs were increasing in areas such as data centre construction and services. Although the study found a positive net employment impact in the areas examined, Ms Georgieva said the trend was not entirely encouraging because much of the employment growth was concentrated in lower-paying jobs.

She identified young people entering the labour market as particularly vulnerable because routine entry-level positions traditionally provide opportunities to gain experience and advance in their careers.

Ms Georgieva urged governments to monitor labour market developments, reform education systems to promote lifelong learning and reconsider tax policies as AI changes the balance between labour and capital.

She warned that a shift toward greater reliance on capital and less on human labour could affect government revenue, limiting public authorities’ capacity to help society adapt to AI-driven changes.

She said she hoped AI would take over undesirable tasks, allowing people to enjoy higher productivity, improved living standards and the dignity of meaningful social participation, adding, “Get AI to do all the stuff we don’t want to do and let us enjoy the things we love to do.”

Singapore President Tharman Shanmugaratnam said AI-driven job displacement would occur gradually, task by task, giving workers and employers time to adapt through workplace learning and skills development.

Mr Shanmugaratnam, however, said demand for entry-level jobs was declining, particularly in technology-related sectors, with potential consequences for fresh graduates. He called on governments to collaborate with the private sector to create employment opportunities for graduates, stressing that securing a first job was crucial to building skills, experience and confidence.

Mr Shanmugaratnam also advocated reforms in tertiary education to reduce excessive emphasis on academic qualifications and expand practical training, internships, workplace attachments and partnerships between universities and businesses.

The Singaporean president said education systems needed to remain flexible, combining specialised expertise with broader human skills, as the future workplace’s precise demands remained uncertain.

“The private sector generates between 75 and 85 per cent of jobs in any country,” the president said. Mr Banga also said that governments must create conditions that encourage businesses to invest and expand. He identified infrastructure, agriculture, primary healthcare, tourism and value-added manufacturing as five critical sectors capable of generating sustainable employment in emerging economies.

Mr Banga said these sectors could create locally relevant jobs without relying solely on outsourcing from advanced economies. The president said that on AI, small-scale applications could improve productivity in agriculture, education and healthcare, particularly in communities with limited access to specialised services. He cited an example of primary healthcare centres in Indonesia, where nurses could use simple AI tools on mobile phones to assess patients’ symptoms and connect with remote doctors.

Mr Banga said that such technology could help healthcare workers identify conditions, obtain medical guidance and arrange specialist appointments more efficiently. The president also highlighted agricultural technology initiatives connecting smallholder farmers and cooperatives with improved seeds, fertilisers, crop insurance, credit and better market prices. He explained that farmers could use basic mobile phones to identify crop diseases and obtain recommendations, helping them make informed decisions and improve productivity.