Brookings Finds Economic Mobility Down 45 Percent as AI and Globalization Reshape New York Work

Artificial intelligence stands poised to disrupt New York’s labour market just as opportunity becomes a rarer commodity.

At the height of Manhattan’s lunch rush, one can count more app-based delivery cyclists than yellow taxis threading the city’s thoroughfares. Yet the technological forces reshaping New York’s jobs go far beyond e-commerce convenience: the advent of ever-smarter artificial intelligence (AI) systems now threatens not only entry-level work, but the very prospect of upward mobility for much of the city’s workforce.

A recent analysis by the Brookings Institution finds that economic mobility—the mainstay of America’s urban promise—has plummeted by 45% nationwide in recent decades. For New York, a city whose mythos is stitched from stories of newcomers rising through grit to prosperity, this is more than mere statistical flotsam. It is a portent: the city’s promise may not survive another technological revolution unscathed.

The news event making waves this spring is a new round of dire predictions, coupled with strategic investments, in the city’s AI sector. The Adams administration, flanked by business leaders and AI boosters, is touting a $25 million package to develop “responsible AI” initiatives, with the Office of Technology and Innovation poised to regulate use in city agencies. Public schools have begun tentative pilots to train students in coding and data skills needed for the new economy. Notwithstanding, many job categories—from accountants on Madison Avenue to paralegals in Brooklyn—now face plausible extinction as automation matures.

These moves raise immediate questions about New York’s future wage landscape. According to city data, just over 20% of New Yorkers—nearly 1.7m people—work in industries identified as susceptible to advanced AI automation. Many of these jobs, in finance, administration, and logistics, are not easily replaced by service work or gig economy hustles. The risk is that instead of freeing time for more creative pursuits, AI undercuts the floor on which tens of thousands of livelihoods depend.

For New York’s middle class, the implications could prove severe. A 2023 report by the Center for an Urban Future notes a stagnant or declining median wage in tech-exposed sectors, even as living costs swell. While the city’s record income inequality might once have seemed a product of sky-high Wall Street bonuses, and low-wage service work, a new danger looms: the erosion of skilled white-collar jobs once thought immune to obsolescence. The celebrated possibility of transition retraining programs raises fresh questions. Who funds such efforts? What jobs will remain for retrained workers if AI’s reach extends ever onward?

What bodes for metropolitan New York nearly always has resonance nationally. After all, the metropolis is a bellwether. The city is home to both Fortune 500 headquarters and nimble start-ups, all eager to adopt AI-driven cost savings and productivity gains. But the paradox remains: while firms may benefit from leaner operations, the reduction in wage earners could wilt consumer demand and—if left unchecked—stress the tax base underpinning public services.

Globally, the precedent is sobering. The International Labour Organization and the OECD have chronicled slower wage growth and rising youth unemployment in major cities that have adopted labour-saving technology without an accompanying surge in new, accessible job categories. In Paris, Seoul, and Shenzhen, policymakers scramble to regulate AI while investing in STEM education, hoping to avoid a permanent underclass or a glut of precarious gig work. New York’s policymakers—hardly renowned for agile foresight—must act with unusual speed and clarity if they wish to dodge this fate.

New York’s response stands at a crossroads

Despite the scale of the challenge, the city has shown flashes of innovation. The City University of New York, for instance, has expanded short-term certification for tech-adjacent roles, aiming to train 10,000 New Yorkers annually by 2025. Local union leaders (not typically accused of futurism) are pressing for collective bargaining clauses around automation impact, betting that solidarity may buy time for adjustment. Grassroots groups, however, warn that such measures seem puny compared with the inexorable advance of AI.

There is also the risk of entrenching new inequalities. Research from NYU’s Centre for Urban Science suggests that AI’s economic dividends will accrue mainly to those with postgraduate degrees or privileged digital access, exacerbating the city’s yawning wealth gaps. Moreover, poorly regulated public-sector adoption—think AI-powered welfare eligibility screening or predictive policing—threatens to replicate historic biases under a veneer of digital objectivity.

Other cities offer both cautionary tales and tentative models. Toronto, for example, has invested heavily in community-based digital literacy but has yet to see a surge in high-wage job creation. Singapore’s much-touted SkillsFuture initiative is lavishly funded and mandatory, but would likely strike New Yorkers as paternalistic. For all the boosterish talk of New York’s unique capacity for reinvention, the city’s advantage may dwindle if rivals cultivate AI skills and safeguards more nimbly.

The temptation for city leaders is to trumpet every new tech incubator ribbon-cutting, but this risks obscuring the magnitude of the coming upheaval. Our reading of the tea leaves is hardly apocalyptic—AI promises not just disruption but, with careful stewardship, new forms of work (and play) that nobody yet envisages. The city’s historic resilience owes much to the churn, from pushcarts to cyberspace. But blithe faith in creative destruction is scant comfort for households who worry that, this time, the next ladder up is missing a few rungs.

So, what portends for economic mobility in New York? If history is a guide, the city can muddle through—but muddling no longer suffices in a world where decisions made in Palo Alto or Shenzhen can upend livelihoods on Staten Island within months. Prudent investment in education, robust regulatory scrutiny, and a willingness to admit that not all transitions are painless will be essential.

What is clear is that the power of AI to both destroy and create jobs is not new to the city’s long history of innovation and reinvention. However, the scale and speed may dwarf earlier reckonings. If New York is to remain a place where tomorrow’s generations do better than today’s, it will require not just more coding bootcamps but a forceful commitment to shared prosperity. Whether those now tinkering with prompt engineers and regulatory sandboxes grasp the enormity of the challenge remains to be seen. ■