---
title: "ILO warns AI could ‘collude’ through algorithms, quietly cutting wages and safety—not just replacing jobs"
date: 2026-03-28
author: ""
url: https://panamadaily.news/ilo-warns-algorithmic-collusion-cut-wages-safety/
categories:
  - "Economy"
  - "Politics"
  - "World"
tags:
  - "AI and jobs"
  - "Algorithmic collusion"
  - "Beijing"
  - "ILO"
  - "Wages"
  - "workplace safety"
---

# ILO warns AI could ‘collude’ through algorithms, quietly cutting wages and safety—not just replacing jobs

Artificial intelligence is unlikely to cause a sudden “robot apocalypse,” the International Labour Organization (ILO) says. Instead, ILO’s chief macroeconomist warned in Beijing that an overlooked risk—“algorithmic collusion”—could be used to suppress wages and degrade workplace safety without obvious job losses.

## What Happened

Speaking in Beijing on Tuesday, Ekkehard Ernst, the ILO’s chief macroeconomist, cautioned that public fears about AI-driven unemployment are often exaggerated. He argued that the main employment threats may be quieter and more gradual.

Ernst said the disruptive impact of AI is not best understood as robots taking jobs en masse. Rather, he highlighted “algorithmic collusion,” describing a scenario where AI systems could coordinate behaviour in ways that weaken workers’ bargaining power.

In that framing, the labour market harm could show up less as dramatic layoffs and more as sustained wage pressure and reduced protection on the job, including workplace safety outcomes.

## Background

The ILO economist’s remarks come amid global debate over how AI will reshape work. Much of the public conversation tends to focus on automation and displacement—whether machines will replace human roles at scale.

Ernst’s intervention shifts the emphasis toward how AI may affect labour demand and employer conduct. “Algorithmic collusion” is presented as a risk where automated systems behave in concert—directly or indirectly—creating conditions that can harm pay and working conditions.

Even without a wave of unemployment, weaker wages and compromised safety can still translate into broad labour insecurity. That is central to Ernst’s argument that focusing only on job-stealing robots misses other pathways through which AI can disadvantage workers.

Because the source reports he was speaking in Beijing, the message also lands in a region where AI adoption and industrial automation are rapidly expanding, raising questions about how labour protections will evolve alongside new technology.

## Why It Matters

Ernst’s warning matters because it points to a labour-policy challenge that can be harder to spot than mass layoffs. Wage erosion and safety deterioration can be gradual, fragmented, and less visible to regulators and workers—especially if AI-driven decision-making is embedded in hiring, scheduling, pricing, or productivity management.

For policymakers, the implication is that preparing for AI’s labour effects may require more than workforce retraining. Governments and regulators may also need stronger oversight of how algorithmic systems affect competition, bargaining power, and workplace standards.

For business and investors, the message suggests reputational and regulatory risks tied to how AI is used in employment practices. If algorithms can be structured or incentivized in ways that reduce worker protections, enforcement may broaden beyond traditional labour inspection into the digital systems behind workplace decisions.

For Latin America and Panama specifically, the relevance is indirect but real: the region’s labour markets are sensitive to shifts in job quality as well as employment levels. Even where AI does not immediately eliminate roles, wage pressure and safety risks can worsen job conditions—an issue that affects household income, labour stability, and the broader social contract.

Panama’s economy, like many others in the region, relies on global trade and service sectors where technology-driven management and procurement are common. If algorithmic systems influence employment terms anywhere in global supply chains, the knock-on effects can surface in local labour practices and competitiveness.

Ultimately, the ILO’s position underscores that AI’s biggest threat may not be dramatic displacement. It may be structural and incremental: workers’ earnings and protections could be eroded through automation-driven coordination that makes exploitation harder to detect until the damage is already done.