“There is no city in America more exposed to both the promise and peril of artificial intelligence than New York City.” That’s what Comptroller Mark Levine said when his office released a report on AI’s potential disruption to the city’s economy.
The Comptroller is right. But New York is about to feel the peril much more than the promise.
The hard truth is that the city has no real plan for AI-induced unemployment, particularly among lower-income New Yorkers. In the country’s largest labor market – one grappling with Gilded Age-level inequality – nearly every sector will see AI job loss. Yet, policymakers haven’t seriously prepared workers whose livelihoods may change or disappear altogether for the jobs that will be created by AI.
When workers lose income, the damage does not stop at the office door. It hits apartments, restaurants, small businesses, subway fares, tax revenue, and the neighborhoods that make New York work.
A $2 trillion economy – a global hub of culture, tourism, and industry – could get hammered by an AI tidal wave that we all saw coming. Unless policymakers act.
New York City needs a comprehensive AI resiliency plan built around three priorities: modernizing education, expanding fast and affordable workforce training, and creating policies that keep up with a fast-changing labor market.
Younger New Yorkers are already feeling the pain of shrinking opportunities. Entry-level jobs in the city dropped 37% between 2022 and 2024. Meanwhile, universities are at risk of falling alarmingly out of step with the job market: For the first time on record, college graduates in New York City are more unemployed than their peers without degrees.
We need to reboot higher education for the AI economy. SUNY, CUNY, and private universities in New York City can lead the way with short-form certificates, AI tools in classrooms, and contemporary curricula that prepare students for in-demand roles.
We also need more agile workforce training. Governor Kathy Hochul recently expanded AI education to the state’s 100,000 employees. Considering the sheer scale of anticipated disruption, that’s like using a toothbrush to clean your house: better than nothing, but not nearly enough to get the job done. City leaders need to act immediately, providing programs that adapt quickly to the realities of New York’s labor market and equip people with the skills and tools they’ll need to get – and stay – employed in the age of AI.
Better training must also be accessible. In a city as unaffordable and unequal as New York – home to more billionaires than anywhere in the world, while a quarter of its residents live below the poverty line – investing in the necessary preparation to survive the shift to the AI economy can be prohibitively expensive.
That’s bad news when you think about which New Yorkers are most vulnerable. College graduates aren’t just losing out on opportunities, they’re also saddled with enormous amounts of debt. And according to a McKinsey report of the New York region, lower wage workers are 4.2 times more likely to be displaced by AI than high-wage ones in the years to come. With free and flexible workforce programs, people won’t go bankrupt training for the jobs of today and tomorrow.
It wouldn’t take much convincing: Americans are already asking for this. According to a Merit America and HarrisX survey, 76% of lower-wage workers believe that training would make them more confident and better prepared in an AI-driven world. There’s no reason a trailblazing city like New York can’t set the example.
But training and education won’t be enough. The city has to AI-proof its economy with the right policy design, one that puts New Yorkers at the center.
We believe Universal Disruption Income – UDI, not UBI – should be part of it. This first-of-its-kind subsidy would directly support workers who lose their jobs to AI, keeping them whole while they retrain and look for new opportunities. Beyond the Comptroller’s proposal for a rainy day fund for the budget, UDI can help keep New York’s economy afloat by going straight into the hands of the people who need it.
At the same time, we need businesses to keep and create good jobs. That means expanding workforce training grants and employment credits that make it easier for companies to hire and retain people.
Leaders like State Senator Michelle Hinchey are on the right track; her proposed AI Labor Information Act would require New York businesses to report on how many workers they’re replacing with AI. That’s the kind of information city leaders can use to develop the right incentives.
However they do it, the point is to keep New York’s human talent and ingenuity thriving in one of the most iconic cities in the world.
This is a wake-up call. The AI tidal wave is coming. A real citywide plan can get working New Yorkers to higher ground.
Connor Diemand-Yauman and Rebecca Taber Staehelin are the Co-founders and Co-CEOs of Merit America, a national nonprofit building a mainstream path to the middle class for Americans stuck in low-wage work.