Recent market volatility driven by fears of artificial intelligence impacting white-collar jobs appears overblown, according to market analyst Jim Cramer. Despite a viral research memo predicting widespread AI-driven unemployment and a significant stock market downturn, economic data and expert opinions suggest a more nuanced reality.
Key Takeaways
- Market analyst Jim Cramer argues against the AI 'doomsday scenario.'
- A viral report predicted 10.2% unemployment by 2028 due to AI.
- Economic data and surveys contradict claims of mass job displacement.
- Cramer advises selective buying and valuation discipline in AI stocks.
- Focus shifts to AI infrastructure and defensive sectors like healthcare.
Challenging the AI Apocalypse Narrative
On February 23, 2026, the stock market experienced a notable dip. The Dow Jones Industrial Average dropped 1.66%, the S&P 500 slid 1.04%, and the Nasdaq saw a 1.13% decline. This downturn followed the circulation of a research memo, 'The 2028 Global Intelligence Crisis,' which painted a bleak picture of AI's future impact on the economy. The report, authored by Alap Shah, suggested an impending 'Ghost GDP' scenario, where AI would lead to massive white-collar job losses and a significant market correction.
Jim Cramer, host of 'Mad Money,' strongly pushed back against this narrative. He labeled the report as 'science fiction' rather than a realistic forecast. Cramer believes the market's intense reaction to AI anxiety is largely unfounded, highlighting a growing disconnect between investor sentiment and actual economic data.
Market Snapshot (as of Feb. 24, 2026)
- S&P 500: +0.83% total return YTD
- Dow: +2.31% YTD
- Nasdaq 100: -1.08% YTD
- iShares Expanded Tech-Software Sector ETF: -27.19% YTD (as of Feb. 23)
The Disconnect Between Fear and Data
While some investors are pricing in a scenario where AI agents devastate the software, services, and finance sectors, the broader economic indicators do not support such a catastrophic collapse. However, the recent sell-off has shown real impact. According to Barron’s, nearly 30% of S&P 500 stocks moved up or down by at least 20% over the past three months. This figure is roughly double the 20-year average.
Enterprise software companies, such as Salesforce, have particularly felt the pressure. These stocks are now trading at approximately 15 times forward GAAP earnings. This contrasts sharply with their five-year average, which was closer to 35 times. Cramer acknowledges that the AI fear trade is a genuine market factor. He warns that if a 'science fiction narrative' can cripple stock markets, investors must be careful with their choices.
"If a science fiction narrative can cripple stock markets, too many things can go wrong if we buy the wrong stocks."
Jim Cramer
Navigating the Market: Selective Buying and Discipline
Cramer advises investors to practice selective buying and maintain valuation discipline. This advice comes at a time when many investors appear to be exiting the market. The Fear & Greed Index, according to CNBC, currently stands at 42, indicating that fear remains the dominant sentiment among investors.
Despite the prevailing anxiety, Cramer does not subscribe to the AI apocalypse scenario. He believes concerns about a widespread white-collar workforce wipeout are significantly overblown. However, he recognizes that powerful narratives can suppress pricing multiples and weigh down stocks, even when their underlying fundamentals are sound. This makes careful stock selection crucial.
Understanding the 'Ghost GDP'
The 'Ghost GDP' concept from the Citrini Research report describes a future where robust productivity and headline growth coexist with lower consumer spending. This scenario suggests that AI-driven efficiency could boost overall economic output, but simultaneously reduce the need for human labor, leading to decreased consumer purchasing power. Since consumer spending drives nearly 70% of U.S. GDP, this could significantly impair the economy.
Debunking the Dystopian AI Report
The Citrini Research report, published on February 22, 2026, made several bold claims. It envisioned unemployment reaching 10.2% by June 2028 due to AI-driven white-collar job losses. It also predicted that agentic coding tools, like Claude Code and Codex, would pressure software and SaaS companies, leading to intense pricing pressure and renewal discounts. The report even suggested a GFC-style bear market, with the S&P 500 potentially falling 38% from October 2026 highs.
Cramer challenged how quickly the market embraced this 'dystopian tale.' He argued that many of the report's claims lack supporting evidence.
- AI-driven job losses: The report projected unemployment rising to 10.2% by June 2028.
- 'Ghost GDP' emergence: High productivity with lower consumer spending.
- Software sector impact: Agentic coding tools causing pricing pressure.
- Market crash: S&P 500 potentially tanking 38%.
Evidence Against Mass AI Unemployment
Contrary evidence from various sources contradicts the report's dire predictions. A recent NBER working paper surveyed nearly 6,000 executives across the U.S., U.K., Germany, and Australia. More than 90% of these executives reported no employment impact from AI in the past three years. Additionally, 89% saw no productivity effect from AI. Executives forecast a modest 0.7% drop in employment over three years, far from a mass unemployment scenario.
Indeed's Hiring Lab also shows that AI is mentioned in only 4.2% of job postings. Overall hiring numbers have risen modestly compared to pre-pandemic levels. Furthermore, AI is creating new job roles. LinkedIn data indicates over 600,000 new data-center jobs globally, directly linked to AI infrastructure expansion.
Indeed CEO Chris Hyams stated, "There’s not a single job anywhere that AI can perform all of the skills required for that job." This highlights the collaborative, rather than fully autonomous, nature of AI in the workplace.
Reality of AI Agent Performance
- July 2025 METR study: Experienced software developers using AI tools took 19% longer due to errors and oversight.
- Frontier agents: Showed nearly 50% task reliability, far below the 99% consistency required by enterprises.
A Reddit user, Aggressive-Bedroom82, also voiced skepticism about the exaggerated claims surrounding AI agents. In a post on r/aiagents, the user criticized the lack of real-world case studies for useful AI agents, contrasting it with the pervasive hype from content creators.
Investment Opportunities Amidst AI Expansion
Despite his skepticism about the AI doomsday scenario, Cramer remains bullish on the 'pioneers of AI,' specifically mentioning Nvidia ahead of its earnings report. He also highlighted the comments from Nvidia CEO Jensen Huang regarding the AI software narrative, who called it "the most illogical thing in the world" and believes "time will prove itself."
Cramer also sees significant opportunities in companies that support AI infrastructure, particularly those involved in power demand. He pointed to GE Vernova, suggesting that the rising demand for AI will necessitate colossal energy buildouts. Additionally, he noted that money has been flowing into defensive sectors like staples and healthcare, as investors seek stability.
However, Cramer drew a hard line on private credit. He explicitly stated he is "not a buyer" of firms like Blue Owl, citing a surge in redemptions. In January, investors pulled 15.4% of assets from one Blue Owl tech-focused fund. The firm also permanently halted redemptions in another major retail vehicle, selling off $1.4 billion in loans to manage liquidity efficiently. This illustrates the importance of careful due diligence even in high-growth areas.