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Is the rise of AI impacting labor markets?

September 17, 2025

As adoption of Artificial Intelligence (AI) continues to rise, Jack Janasiewicz, Portfolio Manager, Natixis Investment Managers Solutions, analyzed recent Federal Reserve Bank of New York data from its Liberty Street Economics blog post titled, “Are Businesses Scaling Back Hiring Due to AI?”.* Overall, he believes the impact of AI on workers is likely to be mixed. “We aren’t seeing significant reductions in employment so far. Also, the results suggest that those who have a job are likely to be retrained rather than replaced by AI.”


How firms are using AI
chart

*Source: Liberty Street Economics, Federal Reserve Bank of New York, Regional Business Surveys in August 2025. “Are Businesses Scaling Back Hiring Due to AI?” September 4, 2025.

  • While firms may not be laying off employees as a result of AI, some reported hiring fewer workers because of their AI use.*
  • 12% of service firms using AI said that they hired fewer workers due to AI use, while 13% anticipate layoffs in the coming months.*
  • How are firms using AI?
    • Over 50% of service firms and 40% manufacturers use AI when searching for information.*
    • 50%-60% of both manufacturers and service firms use AI for marketing and advertising.*

This material is provided for informational purposes only and should not be construed as investment advice. The views and opinions contained herein reflect the subjective judgments and assumptions of the authors only and do not necessarily reflect the views of Natixis Investment Managers, or any of its affiliates. The views and opinions expressed may change based on market and other conditions. There can be no assurance that developments will transpire as forecasted, and actual results may vary.

All investing involves risk, including the risk of loss. Investment risk exists with equity, fixed income, and alternative investments. There is no assurance that any investment will meet its performance objectives or that losses will be avoided. Investors should fully understand the risks associated with any investment prior to investing.

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