JP Morgan predicts a hiring boom with rising wages

JP Morgan predicts mass hiring while everyone antiestéticars AI

While analysts and experts tally up how many millions of jobs artificial intelligence will wipe out, the largest US bank announces exactly the opposite: a hiring boom is coming. The paradox is no small one. JP Morgan argues that the global economy is about to enter the phase where the spotlight shifts to labor, after years in which companies fattened profits without expanding their workforces much.

Global corporate profits soared 35% year-on-year in the second quarter of 2026, the biggest gain in more than two decades excluding the immediate rebounds after the financial crisis and the pandemic. That money is already flowing out of income statements and into investment, and according to economists Joseph Lupton and Maia Crook, the next destination would be jobs.

Profits are growing in 24 of the 28 economies analyzed

The sequence starts with profits, and the improvement is extraordinarily broad. Of the 28 economies the bank analyzes, 24 saw profit growth improve over the past year: the US is up 47% according to the MSCI measure, the eurozone 24% and Japan 18%. It is not just the tech cycle tied to AI; energy, industry, consumer sectors and the banks themselves are also improving.

The crux lies in margins. Revenues rose 9.2%, but margins grew 26%, something the bank considers almost unprecedented outside post-recession recoveries. Companies have been able to raise prices above contained labor costs, with productivity growing around 1.5% a year for two years. An unusually high share of nominal growth is ending up on the bottom line.

Where would all that labor come from?

Unemployment rates could still fall somewhat further —in Spain they have dropped from 10%— but the bulk would have to come from other sources. There are three: the inactive population not looking for work who could rejoin as wages rise, the baby boomers who would extend their careers if staying active becomes more attractive than retirement, and immigration.

With those three cards to play and the existing unemployment margin, JP Morgan believes the wheel can turn. The question is whether those sources respond to higher wages or whether the tight labor market simply stays that way: a market where it is hard to find candidates and nobody raises pay.

Skepticism about the hiring forecast

Against it weighs a distrust that is hard to rebut with headlines. Some recall JP Morgan's role in the collapse of Lehman Brothers and the 2008 crisis, and dismiss its predictions because of that track record. Another argument keeps coming up: if the bank announces a hiring boom, maybe it is positioning, not predicting.

The second front is AI. Some point out the contradiction: one day comes a warning that machines will replace half the workforce; the next, that workers will be in short supply. The two messages do not fit together well. And there remains the question nobody answers with names: which specific sector is going to absorb that army of new employees.

There is a third factor that wage euphoria ignores. Some argue that Western real wages stopped growing decades ago and that, without changes in workers' bargaining power, record profits will return to the shareholder before they reach the paycheck.

The missing link in the economic cycle

Profits and investment are already working: global business investment excluding China grew at an annualized pace of 10% in the first half of 2026. Neither is self-sufficient. Everything depends on the third one arriving —jobs and wages— so the cycle works like a mechanism that feeds itself between profits, hiring, income and demand.

The question is not whether the bank is right, but how long it takes to show up in a paycheck. If the boom comes, it will hit the headlines first and the wallet after. And if it does not come, we will know who not to believe.

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Analysis based on the forecast published by JP Morgan and the debate it has generated.