Bank of Canada: AI Transforming Economy, But No Widespread Job Losses Yet

The Bank of Canada has stated that there is no clear evidence that artificial intelligence has led to widespread job losses, but warns that further adoption could permanently change the economy. Michelle Alexopoulos, external deputy governor, told a business audience in Ottawa that AI could lower costs, improve efficiencies, support higher wages, reduce prices, and spur new investment. However, the Bank is closely monitoring employment data for signs of a material impact on the labour market.

Some workers are already feeling the effects, with weak hiring in roles like entry-level coding and customer service—jobs that often employ younger workers. Alexopoulos drew a comparison to the introduction of computers, which phased out jobs like typists but created new roles like IT departments, ultimately not leading to fewer jobs.

A Statistics Canada study from June 2025 found that almost 90% of businesses adopting AI reported no effect on staffing levels, while 4% saw job creation and 6% decreased staffing. However, a later survey indicated businesses anticipate a more negative impact. A Bank of Canada survey from early 2026 found that most consumers use AI to boost productivity rather than replace workers, with 31% using it for content generation and editing, and 24% for data analysis and coding. Nearly 37% do not use AI at work.

Alexopoulos noted that AI could help solve labour and demographic challenges by filling job openings from slower population growth and retirements. She emphasized that AI is changing how tasks are done, but humans remain in control. The potential for AI to boost productivity could allow economies to grow faster without generating as much inflation, potentially keeping interest rates lower.

Central bankers are also concerned about AI risks to the financial system, including cybersecurity and overvaluation of AI-focused stocks. The Bank of Canada cares about AI because of its potential to affect productivity, economic growth, employment, and inflation.