IMF Report: AI Cuts Hiring Demand by Nearly 10% Across Asia

The IMF says hiring demand in AI-exposed occupations across Asia has fallen nearly 10%, while employers increasingly seek workers skilled in AI tools and applications.

AI Cuts Hiring Demand by Nearly 10% in Asia, IMF Report Finds

Artificial intelligence (AI) is reshaping recruitment trends across Asia, with hiring demand in occupations more exposed to the technology declining by nearly 10% compared with less-exposed roles. However, the decline has stabilised even as AI systems have become more capable, according to a report by the International Monetary Fund (IMF).

The report, Regional Economic Outlook: Asia and Pacific, published in October 2026, examines AI’s influence on labour demand, workplace skills and employment prospects across Asian economies.

The findings are based on an analysis of approximately 40 million online job postings across 19 Asian economies. The IMF said the evidence suggests that AI is changing the nature of work rather than simply eliminating jobs.

AI Adoption Linked to Decline in Hiring Demand

The IMF found that recruitment demand in occupations more exposed to AI weakened following the launch of ChatGPT in 2022. As AI systems became capable of performing tasks previously requiring considerable human time and expertise, employers began adjusting their hiring requirements.

The difference in hiring demand between more-exposed and less-exposed occupations became particularly noticeable as AI tools improved their ability to handle complex tasks.

For example, the report examined AI’s ability to identify and fix bugs in a small software library—a task that could take a human worker around an hour. By the time AI could perform this task, hiring demand in more-exposed occupations had declined by nearly 10% relative to less-exposed roles.

However, the IMF observed that the decline subsequently stabilised, even as AI systems progressed to handling tasks that might take people several hours to complete.

This suggests that improvements in AI capabilities do not necessarily translate into continuously accelerating declines in recruitment demand.

Hiring Slowdown Does Not Necessarily Mean Job Losses

The report cautioned against interpreting the fall in job postings as direct evidence of an equivalent decline in total employment.

Online vacancies primarily reflect employers’ demand for new workers. They do not necessarily capture actual recruitment, changes in existing employees’ responsibilities or other adjustments businesses make when adopting new technologies.

Companies may also advertise positions through channels other than online job portals or revise their recruitment plans before vacancies translate into employment.

The IMF said additional research examining employment levels, wages and working hours would be necessary to understand AI’s broader effects on labour markets.

Nevertheless, the available evidence indicates that reduced hiring demand is currently an important part of AI’s impact on occupations that are more exposed to the technology.

Employers Increasingly Seek AI-Related Skills

While recruitment demand has weakened in some occupations, employers are increasingly looking for workers who can use AI tools, develop AI-powered applications and integrate the technology into business operations.

The IMF identified several emerging skills that have gained prominence since 2023, including:

• Prompt engineering: Developing effective instructions to obtain useful results from AI systems.

• Retrieval-augmented generation (RAG): Connecting AI models with external information sources to improve the relevance and accuracy of their responses.

• AI agent development: Building systems that can perform tasks and coordinate multiple steps with varying levels of autonomy.

• AI application development: Using AI technologies to create software and business solutions.

• AI integration: Incorporating AI tools into existing organisational processes and knowledge systems.

These skills are becoming increasingly relevant as businesses explore ways to improve productivity and incorporate AI into their operations.

The report suggests that workers who can effectively use these technologies may benefit from emerging employment opportunities, even as demand weakens for certain tasks that AI can increasingly perform.

Firms Seeking AI Skills Report Stronger Hiring Demand

According to the report, around 6% of firms in Asia mention AI skills in their online job postings.

The IMF also found that demand for workers is growing faster among firms seeking AI-related skills than among businesses that do not specify these capabilities. This pattern is evident even in occupations that are more exposed to AI.

The findings highlight two simultaneous developments in the labour market. Businesses may reduce recruitment for roles where AI can automate or simplify tasks, while expanding opportunities for workers who can operate, develop or integrate AI systems.

However, the report noted that growth in demand for AI skills has not yet fully offset the reduction in hiring demand across more-exposed occupations.

This shift makes continuous learning and the development of relevant technical capabilities increasingly important for workers navigating an AI-driven economy.

India, Indonesia and the Philippines Face Employment Challenges

The IMF highlighted potential challenges for countries such as India, Indonesia and the Philippines, which have large young populations and need to create sufficient employment opportunities.

In these economies, AI adoption could complicate efforts to move workers from lower-productivity activities into higher-productivity manufacturing and services jobs.

Although sectors such as agriculture may be less exposed to AI, the technology could affect the traditional pathways through which developing economies create employment and improve productivity.

The challenge will be to ensure that workers have the skills needed to access emerging opportunities as businesses change their recruitment priorities.

For countries with growing working-age populations, this transition is particularly important because employment creation remains essential for economic growth and improved living standards.

Skills Development Crucial as Asian Labour Markets Adapt

The IMF’s findings underline the importance of preparing workers for changes in recruitment and workplace requirements. As AI becomes more capable, employers are likely to place greater emphasis on skills that complement the technology.

Investment in education, vocational training and AI-related capabilities could help workers adapt to changing job requirements. Businesses and policymakers may also need to support workers whose roles are increasingly affected by automation.

The report indicates that AI’s labour-market effects are not uniform across countries or occupations. Outcomes will depend on the nature of the work, employers’ adoption of technology and workers’ ability to acquire relevant skills.

Conclusion

The IMF report shows that AI exposure is associated with a nearly 10% decline in hiring demand across more-exposed occupations in Asia, although the slowdown has stabilised. Rising demand for AI skills offers new opportunities, making workforce training and preparedness important priorities for the region.