Anything not healthcare in trouble? Economist warns AI will shatter white-collar jobs

Moody’s Analytics chief economist Mark Zandi is warning that the U.S. economy may be on the verge of recession, citing widespread layoffs and dismal July jobs data that showed only 73,000 new positions created. His analysis suggests that AI-driven automation could make the next economic downturn particularly devastating for white-collar workers who previously considered their jobs recession-proof.

What you should know: Recent employment data paints an increasingly bleak picture of the U.S. job market, with traditional “safe” roles experiencing unprecedented vulnerability.

• The Bureau of Labor Statistics reported just 73,000 jobs created in July, well below the expected 106,000 and down sharply from June’s 147,000 positions.
• Over 53% of industries were cutting jobs in July, with only healthcare adding meaningful positions to payrolls.
• The data was so concerning that President Trump fired the bureau’s chief, baselessly claiming the numbers were manipulated.

The big picture: Zandi believes the economy hasn’t officially entered recession yet, but historical patterns suggest we may already be there without realizing it.

• “Historically, it’s not clear-cut” that the country has slipped into recession “until well after the fact,” Zandi posted on X.
• He indicated that future data revisions may reveal employment has already begun declining.
• JPMorgan senior economist Murat Tasci echoed recession concerns in a recent investors’ note.

Why AI changes everything: The looming recession could hit differently than previous downturns due to AI’s rapid adoption across industries.

• Since the 1980s, routine manual and sales jobs have been declining, while “non-routine cognitive jobs” like scientists, engineers, and designers typically remained stable during recessions.
• Zandi notes this pattern has “changed recently,” with these traditionally secure roles now representing a larger share of the unemployed.
• Tasci warns that AI tools adopted “speedily and broadly” could “induce large-scale displacement for occupations that consist of primarily non-routine cognitive tasks” during the next recession.

In plain English: Jobs requiring creative thinking, problem-solving, and specialized knowledge—roles that people once thought were immune to automation—are now vulnerable because AI can increasingly handle complex mental tasks that only humans could do before.

What this means for businesses: Even companies not actively using AI should prepare for significant market disruptions.

• Small and large businesses across all sectors will likely feel the impact if recession materializes.
• Companies planning to hire may face either a talent shortage in specific skill areas or an overwhelming flood of recently laid-off applicants.
• The available talent pool may not align with traditional hiring expectations, as AI reshapes which skills remain valuable.

The broader trend: Many recent corporate layoffs at tech giants like Indeed, Glassdoor, Microsoft, and Amazon have been explicitly linked to AI implementation, suggesting the technology is already reshaping employment patterns before any official recession begins.