AI is increasingly fueling job insecurity, with higher earners expressing greater anxiety about employment than their lower-income counterparts. While the overall labor market remains strong, recent data reveals a growing sense of caution, particularly among those in the top third of earners. According to the University of Michigan’s survey, sentiment about the labor market has declined over the past year, with the drop most pronounced among high-income workers. Their expectations for rising unemployment have reached the lowest level since the end of the financial crisis in 2009. In contrast, while lower-income workers have also seen declining sentiment, their outlook remains more optimistic. The New York Fed’s Survey of Consumer Expectations shows that the likelihood of finding a new job within three months after job loss is at its lowest point since mid-2013. Meanwhile, ADP’s data on private-sector employment reveals a significant slowdown in job turnover, especially in professional and business services. In January, turnover in this sector hit its lowest level ever recorded by the firm. “The normal push-and-pull of job gains and pay growth — quantity and price — that once kept the labor market dynamic has weakened, giving way to a market defined more by inactivity than vigor,” said Nela Richardson, chief economist at ADP. Despite this trend, the labor market remains robust for higher-income professionals. While the Bureau of Labor Statistics does not report unemployment by income, it does break down rates by occupation. In January, the unemployment rate in finance stood at just 2.1%, nearly unchanged from the previous year. Professional and business services saw a slightly higher rate of 4.5%, but that still represented a 0.4 percentage point decline from January 2025. The fear of AI-driven job displacement is real, as highlighted by Richmond Fed President Thomas Barkin, who noted at a recent event: “We immediately jump to the notion that a bunch of people are going to be displaced. But we should also remember people are going to be enabled.” Kansas City Fed President Jeffrey Schmid echoed this balanced view, emphasizing that in the long run, AI will benefit the labor market and the broader economy. “I personally think we're going to need AI to supplement the fact that we aren't having new entrants into the labor market like we did, let's say 30 years ago or 40 years ago,” Schmid said. “So AI is going to have to be an enhancement to do jobs.”