AI is suppressing wage growth rather than replacing workers

Analysts Sania Edlich and chief economist Torsten Sløk tracked wage and employment data across 321 occupations, finding that jobs with high AI exposure experienced an average 6.7% decline in real wage growth since 2023. While overall employment levels remained stable, the data suggests a clear trend: companies are keeping staff but reducing the pay premiums associated with their roles.

The disparity in impact is sharp. Workers in the bottom 25% of earners saw wages drop by 10.7%, while service sector staff faced a 24.3% decline in earnings growth. High-income earners, by contrast, remained largely insulated from these trends. Apollo utilized Anthropic’s Economic Index to measure task exposure, identifying fields like computer programming and database architecture as primary targets for wage suppression.

Some sectors defy this pattern, however. Personal finance advisors and administrative law judges saw wage increases despite moderate AI exposure, suggesting that industry-specific demand can temporarily offset automation pressures. With an estimated 5.8 million workers currently in highly exposed roles, the report warns that the widening income gap could force a major shift in labor market policy as corporate adoption of these tools continues to accelerate.