Artificial intelligence is set to transform the job market, with young workers likely to suffer most, the head of the International Monetary Fund has warned. Kristalina Georgieva told delegates at the World Economic Forum in Davos on Friday that AI will act like a “tsunami hitting the labour market.” Georgieva cited IMF research showing AI will change demand for skills across the globe. She said 60% of jobs in advanced economies and 40% worldwide could be affected over the next few years. Some roles will be enhanced, others eliminated, and many more transformed. She added that around one in ten jobs in advanced economies has already been enhanced by AI. These positions often see higher pay, with economic benefits spreading locally. However, entry-level positions, often filled by younger workers, are at high risk of being removed. This could make it harder for young people to find meaningful jobs. Georgieva also warned that workers whose roles are not directly changed by AI may face lower wages if productivity does not increase. She said the middle class is likely to feel the impact as well. Her main concern is that AI is moving faster than regulators can keep up. “We don’t know how to make it safe. We don’t know how to make it inclusive,” she said. “Wake up, AI is for real, and it is transforming our world faster than we are getting ahead of it.” The discussion at Davos, where world leaders and business elites meet each year, has also focused on other global issues, such as US trade policy. But AI dominated much of the debate. Christy Hoffman, general secretary of the UNI global union, said AI’s main business purpose is to increase productivity and lower costs, which will lead to job losses. Hoffman urged companies to manage this disruption responsibly. She called for AI’s productivity benefits to be shared fairly across the economy and for employers to consult workers before introducing new AI tools. “We’re not going to stop AI, nor do we want to,” she said, “but we don’t want it to just roll over us.” Microsoft CEO Satya Nadella also warned that AI could lose public support if its benefits are concentrated among a few tech companies rather than society at large. He said the technology could play a crucial role in areas like developing new drugs but needs broad societal gains to maintain legitimacy. Georgieva spoke on a panel with European Central Bank President Christine Lagarde, who cautioned that AI growth could be limited by mistrust between major economies. She noted that AI requires large amounts of capital, energy, and data, which may be restricted if countries do not cooperate or set clear rules. Lagarde also highlighted the risk of growing global inequality, warning that disparities between countries are becoming deeper and wider. Earlier in the week, Canadian Prime Minister Mark Carney urged delegates to prepare for a permanent “rupture” in the global economic order due to unpredictable US trade policies. Lagarde, however, was more optimistic, suggesting the focus should be on finding alternatives rather than expecting a collapse. The IMF chief’s warning underscores a major shift in the workforce, with young people particularly vulnerable. As AI continues to expand, policymakers, businesses, and workers will need to adapt quickly to a rapidly changing labor landscape.