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A viral chart showing the S&P 500 soaring while job openings plunge has fueled fears that artificial intelligence is splitting the American economy in two. Since ChatGPT's debut in November 2022, the S&P 500 has surged more than 70%, while job openings have fallen about 30%. Journalist Derek Thompson, writing in his Substack last week, called the graphic "the scariest chart in the world," but said the truth is more complicated.
Data from the Bureau of Labor Statistics shows job openings peaking at 11.5 million in March 2022 before sliding to 7.18 million by August 2025. Over the same period, the S&P 500 rose from roughly 3,840 to nearly 6,700—a 74% gain. According to Thompson, the real driver behind this split isn't AI but monetary tightening by the Federal Reserve, reported Fortune.
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The Fed began hiking interest rates in March 2022 to curb inflation, pushing borrowing costs higher and cooling business investment. That, in turn, curbed hiring. Construction and manufacturing—industries sensitive to credit conditions—saw the steepest drops in job openings. Construction openings fell nearly 40% year over year by late 2024, data from Employ America shows.
Trade and immigration policies have further constrained hiring. The National Foundation for American Policy estimates that President Donald Trump's immigration restrictions could shrink the U.S. workforce by 15 million over the next decade and cut annual GDP growth by one-third.
While hiring weakened, AI-related stocks powered the market rally. JPMorgan found that 75% of the S&P 500's gains since late 2022 came from AI-linked firms such as Nvidia (NASDAQ:NVDA), Microsoft (NASDAQ:MSFT), and Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL), generating $5 trillion in household wealth. But as Morgan Stanley's Lisa Shalett warned, such concentration raises bubble risks.
Still, the labor effects of AI remain uneven. Stanford researchers found early-career workers in AI-exposed fields saw a 13% employment drop, though the Bureau of Labor Statistics projects software jobs will grow nearly 18% by 2033.
As Thompson put it, "There really do seem to be two economies right now—a booming AI economy and a lackluster everything-else economy." Whether that divide endures—or bursts—may define America's next economic chapter.
The current economic situation is a result of various factors, including monetary tightening from the Fed, trade restrictions, immigration enforcement, and an AI investment boom on Wall Street. Furthermore, warnings from Bank of America Corp. CEO Brian Moynihan about a potential economic slowdown due to a prolonged government shutdown and concerns raised by Tesla Inc.CEO Elon Musk about the U.S.’s growing national debt and possible Social Security shortfall add to the complexity of the situation.
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Photo: MMD Creative via Shutterstock
