Analyst Brett Jensen (Seeking Alpha) Warns: AI could lead to widespread white-collar job losses and an economic crisis as early as the second half of the decade
For three decades, white-collar workers seemed to enjoy relative job security. As globalization and trade agreements like NAFTA pushed out millions of manufacturing jobs in the United States, the message to young people and workers forced to reinvent themselves was clear: “Learn to code, learn to work in service and research professions, and you will find a secure future there.” But now, with the AI revolution, that balance is changing dramatically, and it is precisely the jobs that were perceived as resistant to technological change that are at risk.
In a comprehensive article published on August 29, 2025 on the website Seeking Alpha, claims the American analyst Bret Jensen, Capital Markets Expert and Investment Group Manager The Biotech Forum, that the United States is approaching one of the historic turning points in the labor market. Jensen points out that while the manufacturing sector is experiencing a revival, with large government investments in returning assembly lines to the United States and massive data center construction projects for leading technology companies, white-collar workers – those educated young people working in management, service, analysis and software jobs – are facing an unprecedented wave of layoffs. He says, “The AI revolution is expected to be the largest disruptor in the history of the American labor market – with the potential to lose jobs in the millions, especially among young workers and white-collar occupations.”
The range of actions that GEN AI can perform
The main reason for concern lies in the very structure of the current technological revolution. Generative AI systems are no longer limited to writing simple texts or automatically responding to customers. They generate software code, conduct financial research, perform advanced semantic searches, write preliminary legal opinions, and even produce full multimedia content. All of this directly harms the employment layer that has been considered for years the mainstay of the new middle class. Jensen cites survey data from the Federal Reserve Bank of New York indicating that already today, more than six percent of computer science graduates and seven and a half percent of computer engineering graduates are unemployed – the highest unemployment rates among university graduates.
This dynamic is being reinforced by the changing balance of employment. Massive investments in new data centers, required to support the massive growth of AI applications, are creating a huge demand for skilled workers in construction, electrical, plumbing, and energy operations. These jobs are primarily aimed at blue-collar workers, who have suffered economic decline in recent decades. Now, they are enjoying a renaissance, while their colleagues with academic degrees find themselves in a vulnerable position.
The macro implications are not limited to the labor market. Jensen points out that if these trends continue, the American economy could fall into a “white-collar recession” as early as 2026 or 2027. A rise in unemployment among educated young people, many of whom carry high levels of student debt, will lead to a sharp jump in default rates and a deterioration in credit scores. According to the data, the rate of student loan delinquency has already climbed to 12.9% in the summer of 2025. This situation is expected to directly affect the housing and consumer markets: workers without job stability and without sufficient credit ratings will not purchase new homes and will not spend money on luxury goods or travel. At the same time, office real estate, which is already facing a decline in demand since the coronavirus pandemic, may suffer another hard blow.
The big question, as Jensen puts it, is whether the U.S. market can create enough new jobs to offset the job losses caused by AI. “I have no doubt about the innovation and inventiveness of the American economy,” he says, “but it’s hard to imagine a rate of new job creation that comes close to the scale of job losses expected from AI if the projections come true.”
In conclusion, Brett Jensen’s article describes a paradoxical reality: while the blue collar – the symbol of job losses in recent decades – is coming to life thanks to new manufacturing and energy investments, the white collar faces tangible danger. The digital revolution from which younger generations have looked to secure livelihoods and job security may actually become an engine of widespread economic instability. If these predictions come true, it is possible that in twenty years the 21s of the XNUMXst century will be remembered not as the “AI boom” but as the beginning of the white collar recession.
The article is based on a publication by Bret Jensen, Market Analyst and Investment Group Leader The Biotech Forum, on site Seeking Alpha (August 29, 2025).
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