New York Fed: firms report using AI to reshape work, not to cut jobs

Economists at the Federal Reserve Bank of New York say their latest regional business surveys show firms mostly using AI to change how work is done rather than to reduce headcount. The bank has been asking businesses in its district about AI in August waves since 2024.

One detail cuts against the most common fear: about 13 percent of service firms told the bank they had hired more workers because of AI, roughly in line with last year. The authors summarize the pattern as AI augmenting workers more often than replacing them, while cautioning that the technology is still evolving and the pattern could shift as adoption matures.

What this means in practice: for now, the measurable effect of AI inside these firms looks like task change, not mass elimination. That matches what workers in changing roles tend to see first — a different mix of tasks, new tools to learn, and new expectations about review and quality control.

As with all such surveys, this reflects what firms report about themselves, in one large US region.