Bank of America: AI Is Powering Growth, But Not Killing Jobs (Yet)

Artificial intelligence isn’t just hype. More than just a buzzword, it’s now visibly shaping the United States’ economy through massive waves of AI-related investment.

According to the Bank of America Institute’s October 2025 report, AI has been a positive driver of U.S. GDP growth this year. Capital expenditures tied to AI, particularly in software and computing, helped lift GDP by 1.3 percentage points in the second quarter of 2025.

Even small businesses have contributed to the economic growth, increasing their AI spending to boost payment efficiency and customer engagement.

Yet, for all the talk about AI revolutionizing the economy, the same report found something surprising: AI hasn’t meaningfully disrupted the job market — at least not yet.

AI is often blamed for everything from hiring freezes to increased unemployment and shrinking entry-level opportunities. But Bank of America’s data suggests the connection isn’t as direct as headlines make it seem.

While analysts found a “slightly negative correlation between higher AI usage and employment growth,” the relationship was statistically insignificant. In other words, weak job growth may have more to do with broader economic uncertainty than with AI replacing humans.

This conclusion aligns with previous research — including a Yale Budget Lab study that examined the effects of the generative AI tool ChatGPT’s release on U.S. employment. Amid fears of job loss due to automation, researchers found “no discernible disruption” in the labor market even 33 months after generative AI entered mainstream use.

Still, Bank of America analysts caution against assuming the trend will hold, as displacement arising from automation may emerge later. This is typically explained as the lag effect, which is a delay between when new technology is introduced and adopted and when it begins to reshape hiring and labor markets.

For now, AI’s clearest influence lies in how it enhances productivity rather than eliminates roles.

Bank of America’s report shows that sectors like information, finance, and real estate — all reporting high AI adoption — have seen a “relatively strong positive relationship” between AI use and employment growth. Efficiency gains in these industries with the help of AI may even help offset labor shortages caused by tighter immigration policies or aging workforces.

But that doesn’t mean all roles are safe. The report also cites the Bureau of Labor Statistics projections, which note that clerical, administrative, and customer support jobs — whose core tasks most easily automated by generative AI — will likely feel the first real effects.

Long-term projections from 2023 to 2033 also show mixed outcomes. AI impact doesn’t always result in job loss, as it even boosts roles focused on building and maintaining AI system. Between 2023 and 2033, employment for software developers is expected to grow 17.9%, one of the fastest rates across all occupations.

Bank of America’s findings sound reassuring: AI is fueling economic growth without mass unemployment. It echoes the optimism previously expressed by other tech leaders, such as Google Cloud CEO Thomas Kurian, who said the AI job panic is overhyped.

But it helps to remember that this optimism comes with an asterisk.

Even as productivity rises, wage growth is slowing, implying that many workers aren’t seeing the benefits of AI-driven efficiency in their paychecks and career trajectories. And while jobs haven’t vanished, they’re quietly evolving, often faster than workers can adapt.

So yes, AI is powering growth. But whether that growth translates into shared prosperity or a deeper divide between tech creators and everyone else remains uncertain.

For now, the job market looks stable; maybe even resilient. But if history tells us anything, stability before disruption often feels like calm before the storm.