UN warns of economic productivity crash due to AI job losses
Artificial intelligence can improve productivity, but a report from the United Nations warns of potential job losses disrupting economies
The United Nations’ (UN) latest take on technology is that the distinctive feature of artificial intelligence (AI) is its ability to amplify human intelligence. Intelligent machines allow for more effective human and robot collaboration that may spark a fifth industrial revolution. However, there is a risk this could lead to job losses.
The UN’s Technology and innovation report 2025 predicts that a new wave of technological transformation will reshape the economy and society. The report warns there is a risk that the use of AI will replace many workers while not creating enough new jobs, and may also widen job polarisation and increase income inequality.
It points out that developed countries are more likely than developing countries to face more immediate labour market adjustments and an increase in wage inequality. The report cites the UK as an example of a country where a significant share of employment is in professional and managerial occupations, which are highly exposed to AI augmentation. It notes that job losses may also occur in clerical support and technician occupations due to AI-related automation.
Tech inequality
The report highlights that nearly half of the occupations that could benefit from augmentation face digital barriers. It also notes a significant gender-related imbalance in automation, largely because women are more likely to perform the most exposed jobs.
“The proportion of women-held jobs that are exposed to automation can be up to twice that of men,” it warned, adding that the gender divide in digital skills and access to IT skills may limit the benefits of AI adoption for women, potentially widening existing inequalities.
Since AI can augment or displace labour, the UN notes that productivity gains depend on long-term structural adjustments in the labour market. Citing Organisation for Economic Cooperation and Development (OECD) findings from 2024, the report said: “If AI is designed and used primarily as a labour-substituting technology, in the long term, the declining employment share in sectors that are more AI intensive can diminish the overall economic effect of productivity gains.”
It stated that workers who lose their jobs to AI may be hired in sectors with lower productivity, which could result in job polarisation and widening income inequality.
The UN warned that while productivity may increase in AI-intensive sectors, the aggregate productivity impact could be limited by slower productivity growth in labour-intensive sectors.
The report recommended that governments promote human-complementary AI technologies through increased research and development funding, strategic public procurement and targeted tax incentives. “Improving labour market opportunities and establishing clear career development pathways can mitigate the risk of brain drain,” it stated.
Technological dominance
The UN also looked at where AI developments are taking place. The report notes that most of the leading semiconductor companies are from the US and other developed economies, with the US having around one-third of the top 500 supercomputers and more than half of overall computational performance, based on the TOP500 2024 supercomputer performance benchmarks. China is ranked second, with 80 of the top 500 supercomputers, although its total computational performance is less than one-tenth that of the US.
The UN warned that most developing countries have limited capacities in AI hardware and infrastructure, which hinders their adoption and development of AI. It said this should raise concerns over supply chain vulnerabilities and the interest of governments to achieve autonomy in the development of technologies that are crucial for advancing national developmental goals.
