Goldman just looked at 40 years of data on the ‘scarring’ effects of technological disruption and finds Gen Z isn’t the most at risk

April 6, 2026 - 17:14

A new analysis of four decades of labor market trends reveals that while technological disruption leaves lasting scars on workers' earnings, Generation Z may not be the demographic most at risk. The research indicates that the long-term financial impact is most severe for those displaced mid-career.

Economists found that workers who lose their jobs due to technological change suffer significant, persistent earnings losses. Over the decade following such a displacement, real earnings for these individuals grow nearly 10 percentage points less compared to their peers who were not displaced. This "scarring" effect underscores how technological shifts can permanently alter career trajectories and lifetime income.

The data suggests that older, more experienced workers face a steeper climb to recover. Their established higher wages and specialized skills can become a liability when their roles are automated or transformed, making it difficult to find comparable new positions. Meanwhile, younger entrants to the workforce, like Gen Z, often possess digital-native skills and have more time to adapt and retrain, potentially offering a buffer against the most severe long-term financial consequences. The findings highlight that the human cost of innovation is complex and distributed unevenly across the workforce.