Artificial intelligence is reshaping employment patterns in multiple advanced economies, producing a mix of job reductions, redeployments and productivity improvements, according to a new AlphaWise study conducted by Morgan Stanley. The survey, which spans firms in the United States, United Kingdom, Germany, Japan and Australia, reports a modest overall contraction in payrolls as AI tools become more widely used.
On average, companies reported a 4% net loss of jobs over the past year correlated with AI adoption. That headline figure reflects offsetting movements inside firms: 11% of positions were eliminated through AI-driven automation while 12% of roles were left unfilled. These losses were not the whole story, however, as businesses also recorded 18% in new hiring tied to the same technological shifts, signaling an ongoing workforce reshaping rather than an outright reduction in employment opportunities.
The survey highlights clear regional differences. The United Kingdom experienced the largest net reductions in employment, while the United States diverged from that pattern and recorded a 2% net increase in jobs. The US outcome was associated with relatively stronger hiring and more active retraining efforts by employers, the survey indicates.
Disruption was concentrated among early-career workers. Employees with roughly 2-5 years of experience were identified as the group most exposed to change: they were simultaneously the most likely to lose roles and the most likely to be retrained or redeployed as companies adapted processes and job scopes around AI capabilities.
Sectoral effects varied. The automotive industry experienced the steepest declines in staffing levels, according to the survey, while real estate showed small gains in employment. Company size also mattered: smaller firms tended to emphasize retraining existing staff, whereas mid-sized companies reported the highest levels of job losses.
Despite reductions in some roles, firms reported meaningful efficiency improvements tied to AI. Average productivity rose by 11.5% across the surveyed companies. The most pronounced gains were concentrated in areas where automation and AI tools are more readily applied, including information technology, software development and customer service.
Methodological note: The findings come from the AlphaWise survey conducted by Morgan Stanley and cover companies across the five named countries. The survey measures reported changes in employment and productivity in relation to AI adoption. Where details are limited in the survey, those limitations are reflected in the reported results rather than supplemented with additional claims.