AI's Impact on Entry-Level Jobs: A Growing Concern for Recent Graduates

Is AI Killing Entry-Level Jobs? Here's What We Know

When a disruptive new technology comes along, it can make millions of jobs redundant while creating roles that are sometimes more interesting and rewarding than those they displaced. What this optimistic reading overlooks is that some of those displaced routine jobs function as steppingstones to careers. These are the roles filled by less experienced workers who can't yet be entrusted with too much responsibility but need exposure to their chosen industry to progress. Entry-level jobs appear uniquely vulnerable to getting hit by the new generation of artificial intelligence tools. These roles are disproportionately focused on the kinds of straightforward, low-stakes tasks -- summarizing documents, collating data and basic coding -- that ChatGPT, Claude, Gemini or other platforms can do in seconds.

AI is already impacting the labor market, starting with young tech workers, Goldman economist says

A screen displays the the company logo for Goldman Sachs on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., May 7, 2025. Changes to the American labor market brought on by the arrival of generative AI are already showing up in employment data, according to a Goldman Sachs economist. Most companies have yet to deploy artificial intelligence in production cases, meaning that the overall job market hasn't yet been significantly impacted by AI, said Joseph Briggs, senior global economist of Goldman's research division, in a podcast episode shared first with CNBC. But there are already signs of a hiring pullback in the technology sector, hitting younger employees there the hardest, Briggs said. "If you look at the tech sector's employment trends, they've been basically growing as a share of overall employment in a remarkably linear manner for the last 20 years," Briggs said on the episode of "Goldman Sachs Exchanges" to be aired Tuesday. "Over the last three years, we've actually seen a pullback in tech hiring that has led it to undershoot its trend." Since its November 2022 release, OpenAI's ChatGPT has fueled the rise of the world's most valuable company, Nvidia, and forced entire industries to contend with its implications. Generative AI models are quickly becoming adept at handling many routine tasks, and some experts say they are already on par with human software engineers, for instance. That has sparked concerns that while automation will make companies more productive and enrich shareholders, swaths of the job market could be impacted in the coming years. Technology executives have recently become more candid about the impact of AI on employees. Companies including Alphabet and Microsoft have said AI is producing roughly 30% of the code on some projects, and Salesforce CEO Marc Benioff said in June that AI handles as much as 50% of the work at his company. Young tech workers, whose jobs are the easiest to automate, are the first concrete signs of displacement, according to Briggs. Unemployment rates among tech workers between 20 and 30 years old jumped by 3 percentage points since the start of this year, he said. Briggs recently co-authored a report titled "Quantifying the Risks of AI-Related Job Displacement" that cites labor market data from IPUMS and Goldman Sachs Global Investment Research. "This is a much larger increase than we've seen in the tech sector more broadly [and] a larger increase than we've seen for other young workers," he said. The approach from technology CEOs has been to hold off on hiring of junior employees as they begin to deploy AI, said George Lee, the former technology banker who co-heads the Goldman Sachs Global Institute. "How do I begin to streamline my enterprise so I can be more flexible and more adaptive and do it yet without harming our competitive edge?" Lee said in the podcast episode. "Young employees for this period of time are a little bit the casualty of that." Over time, roughly 6% to 7% of all workers could lose their jobs because of automation from AI in a baseline scenario, according to Briggs. That transition could be more painful, both to workers and the broader U.S. economy, if adoption among companies happens faster than the roughly decade-long period he assumes, Briggs said. That could either be because of advances in the technology or an economic slowdown that encourages companies to cut costs, he said. If AI researchers achieve AGI, or artificial general intelligence that equals a person's ability to learn and adapt across domains, instead of being narrowly deployed, the impact on workers would probably be deeper. "Our analysis doesn't factor in the potential for the emergence of AGI," Briggs said. "It's hard to even start thinking about the impact on the labor market, but I would guess there probably and undoubtedly is more room for labor substitution and a more disruptive impact in that world."

AI Is Already Disrupting Labor, and Recent Grads Could Be a â€~Lost Generation’

“Artificial intelligence is going to replace literally half of all white-collar workers in the U.S.†That’s a direct quote from Ford CEO Jim Farley from earlier this month. And he is not the only executive ringing the alarm. Perplexity CEO Aravind Srinivas recently told The Verge that he expects AI to be able to replace recruiters and executive assistants in the next six months. The warnings are plenty, and the timeline the executives give is relatively short. But the reality may be even more imminent. “The disruption of jobs is already underway, it’s expanding rapidly and it will continue to,†according to John McCarthy, associate professor of global labor and work at Cornell University’s School of Industrial and Labor Relations. Anthropic’s latest AI assistant, released on July 15, pretty much does all the work that a finance intern would do at an average Wall Street firm. Shopify CEO Tobias Lütke told the company’s hiring managers that they have to explain why an AI agent can’t do the job before they can go ahead with hiring new workers, in an internal memo earlier this year. Duolingo CEO Luis von Ahn sent a similar memo to workers this year. “We can certainly say we are facing a serious breakdown in early stages of white-collar careers, and that’s really important because that’s where economic security begins and where we really build our foundations. And right now, that foundation is starting to be pulled away,†McCarthy told Gizmodo. It’s a particularly bad time to be an unemployed 20-something right now. The New York Fed released a report in April saying that the labor market for recent college graduates between the ages of 22 and 27 had “deteriorated noticeably in the first quarter of 2025,†with an unemployment rate at its highest since the pandemic. And the gap in unemployment rates between recent graduates and all workers is at its widest since 1990. Some of that has to do with broader market level trends, the end of a post-covid hiring boom, and a softening economy, but AI is still a significant factor. Generative AI is particularly good at basic tasks, one that a recent graduate might be expected to complete as an entry-level worker. “Evidence for AI’s negative impact on early careers is already strong, and I worry that the current generational squeeze might evolve into a permanent reconfiguration of early career paths,†McCarthy said. This, in practice, is a tearing up of the social contract for recent graduates: entry level white-collar work is supposed to function as a training route for the rest of your career. With less of those opportunities at hand for recent college graduates, we are likely to see â€"and according to McCarthy are already seeingâ€" increased reliance on elite internships and networking. That is only bound to widen inequality. “There is a real fear that I have that an entire cohort, those graduating during the early AI transition, may kind of be a lost generation, unless policy, education and hiring norms adjust,†McCarthy said. “And I’m not tremendously optimistic about those adjustments happening at the scale they need to.†New York University professor of management and organizations Robert Seamans, however, thinks we are not at the foot of a labor crisis because, despite the hype and the hiring freezes, we are actually seeing “relatively low rates of AI adoption†across the corporate sector. According to a recent Fed paper, one of the biggest challenges in scaling AI right now is not the tech itself; it’s getting businesses to actually use it. Most companies outside of tech, finance, and scientific industries have not worked generative AI into their daily operations yet, and even so adoption is far higher within larger firms than small ones, according to the paper. “It’s much harder to implement AI in a firm than people realize,†Seamans told Gizmodo. “Firms don’t typically have the in-house talent that’s needed to train, operate and oversee whatever AI they implement, and so until you have the personnel in place that have that expertise, it’s going to be really hard to rely heavily on AI.†Instead, Seamans thinks some of these companies who are freezing hiring or shrinking their headcount in favor of AI are actually using the technology as a scapegoat for the performance of their firm. “It’s much harder to blame tariffs or economic uncertainty for reasons why there’s not as much hiring,†Seamans said. Nevertheless, even Seamans says he can’t help but notice the signs pointing at AI as at least a partial culprit of what’s happening in the labor market. But to better understand AI’s role, we need the input of “a fully funded U.S. statistical agency,†Seamans said, like the U.S. Census Bureau or the Bureau of Labor and Statistics. “I think it really highlights the need for the federal government to be tracking AI deployments in firms in real time, so that instead of speculating whether AI may or may not be responsible, we can actually do some research using current data,†Seamans said. AI is here to stay. And it’s looking likely that AI innovation and proliferation in the corporate world are only bound to accelerate from here. That won’t necessarily lead to “wholesale termination†of jobs but rather a restructuring, according to McCarthy. “Human work is shifting and it will continue to, it’s really hard to forecast how it will shape out, but I think there will be enduring demand for roles that require judgment, ethics, creativity, and for jobs that require incorporating context,†McCarthy said. This restructuring is going to put pressure on colleges, and even K12 institutions, to prepare their students accordingly and not just in computer science classes. McCarthy says he is already implementing this himself at Cornell by teaching his students AI-assisted workflows and tools alongside other general skills in classes. The other half of the coin is policy. “These changes are happening very fast and with greater potential to impact jobs at scale than at any point in history, and I think there are urgent needs for multi-stakeholder dialogue across all levels,†McCarthy said, adding that public policy, educational institutions, and the private sector should be in constant conversation with each other over how to address these issues. For workers looking to adapt, McCarthy says that what matters most is getting fluent in using AI tools, increasing your adaptability to new roles, and being ready to pivot whenever you may need to.

AI Is Threatening Entry-Level Jobs That New Grads Needed to Get On-the-Job Training

New reporting by the Wall Street Journal has revealed what many young workers are feeling: that the share of entry-level jobs appears to be shrinking. The reporting draws on analysis by the Burning Glass Institute, a labor analytics firm. According to its study of unemployment rates among young people, the firm found that individuals of all education levels experienced higher levels of unemployment in 2023-2025 compared to 2018-2019. By far the biggest change was felt by college students one year after earning their bachelor's degree, whose unemployment level rose from 3.8 percent to 4.9 percent. Those with graduate degrees didn't fare much better, rising a whole percentage point from 3.2 to 4.2 percent. The unemployment rate among people who had some college and no degree, for comparison, rose 0.4 percent over the same period, while those with only a high school diploma rose 0.1. Overall, the unemployment rate for all recent graduates sits at over 6.6 percent, markedly higher than the national average, which hovers around 4 percent. Meanwhile, the WSJ notes, white collar industries like finance and insurance are still growing, even as their worker base faces growing pressure in wage growth and long-term employment. Together, the analysis seems to suggest that companies are becoming more efficient, despite slow-rolling new hires -- which, though not everyone agrees, implies that AI is making things tougher in the job market. "This is a more tectonic shift in the way employers are hiring," Matt Sigelman, president of Burning Glass, told the WSJ. "Employers are significantly more likely to be letting go of their workers at the entry level -- and in many cases are stepping up their hiring of more experienced professionals." As all this is going on, the WSJ reports that the entry-level job search platform Handshake has hosted 15 percent fewer listings compared to the last academic year. The number of applications per job, meanwhile, rose by around 30 percent. Taken at face value, the future looks dark and uncertain. For example, who's providing support and training for the seasoned workers of tomorrow? What happens to global production when there are no more "experienced professionals" left to hire? Luckily, history gives us some clues. Assuming large language models (LLMs) -- the actual tech behind most consumer-facing "AI" -- do come to upend the labor market, it will likely look similar to the Industrial Revolution, when low-skilled wage work took the place of skilled trades as the major productive force, thanks to huge advancements in manufacturing tech. During this period of technological upheaval, many apprentices and young craftworkers were forced to take up factory work to earn a living, subjected to brutal work conditions, downward wage pressure, and the threat of growing unemployment. Importantly, the Industrial Revolution served to snatch manufacturing power away from artisans and put it into the hands of factory owners. While work looks way different now than it did back then, it's not difficult to imagine a future where -- if entry level jobs remain hard to come by -- young workers of all backgrounds are sucked into gig and service work, just as young apprentices were forced into factories in the late 1800s. However, whether AI actually represents a new Industrial Revolution is another story. The tech is notoriously buggy in real-world applications, and productivity gains are minimal so far. Still, that hasn't stopped companies and their executives from using the tech to scare employees and decide who to fire, while using AI hype to boost their stock prices. Many are warning this will have unintended consequences down the line, as the tech giants building AI become "too big to fail," leaving workers to face the consequences of rapacious AI spending on their own. Those anxieties are heightened when one considers what many are calling the "AI bubble": the fact that, despite shoveling billions of dollars into the AI furnace, the tech has yet to deliver financial returns even close to what Wall Street number crunchers need -- and some say it never will. Regardless, tech moguls and corporate CEOs have made it abundantly clear that this is the future they want. Ultimately, what happens to the job market should mass automation come to pass won't just be a matter of corporate finance, but would redefine work for generations to come.

Is AI Stealing Jobs From Young Workers? Goldman Sachs Data Reveals Unemployment Trends

Goldman Sachs forecasts that AI will displace 6% to 7% of all U.S. workers. AI is eliminating jobs in the U.S., especially for young tech workers just starting in their careers. In a Monday Goldman Sachs note, obtained by Business Insider, the investment firm wrote that since ChatGPT was introduced in November 2022, the tech sector's share of U.S. employment, which had just hit its highest point, has been declining. Unemployment is especially high for 20- to 30-year-olds aiming to work in the tech sector, the report found. Since the start of 2024, the unemployment rate for that group has risen by nearly 3%, more than four times greater than the overall rate. Goldman Sachs says that the increase is an indicator that AI is starting to take over white-collar work, starting at the entry level. Related: Here Are the Odds of Landing a Summer Internship at Goldman Sachs or JPMorgan The bank's Chief Economist, Jan Hatzius, estimated in the note that AI will replace 6% to 7% of all U.S. workers within the next decade. However, he predicted that the unemployment rate would only grow by a "manageable" 0.5% due to AI, because affected workers would shift to other industries. AI isn't just increasing unemployment by taking over entry-level tech jobs -- it is also causing mass layoffs. According to a Tuesday report shared by the coaching company Challenger, Gray & Christmas with CBS, AI has directly caused more than 27,000 job cuts in the private sector since 2023. "The industry is being reshaped by the advancement of artificial intelligence," Challenger, Gray & Christmas told CBS. Related: Is AI the Reason for Your Layoff? New York Becomes the First State to Require Companies to Disclose If So. Tech leaders are also sounding the alarm on the technology's ability to replace jobs. Dario Amodei, the 42-year-old CEO of AI startup Anthropic, predicted in May that AI could eliminate half of all entry-level, white-collar work and result in unemployment rising to as much as 20%. AI will affect white-collar industries like technology, law, and finance, Amodei said. Nobel Prize winner Geoffrey Hinton, 78, had a similar prediction. Hinton, who is often called the Godfather of AI because of his pioneering work on neural networks, forecast in June that "AI is just going to replace everybody" in white-collar jobs. "I think for mundane intellectual labor, AI is just going to replace everybody," Hinton said at the time.

Goldman Sachs Warns AI Is Already Displacing Young Tech Workers - Goldman Sachs Group (NYSE:GS)

Goldman Sachs GS has highlighted the impact of artificial intelligence (AI) on the job market, especially affecting young tech workers. What Happened: The tech sector's share of the US employment market peaked in November 2022, coinciding with the launch of ChatGPT, an AI language model. Since then, it has fallen below its long-term trend, as per a note by Jan Hatzius, Goldman Sachs' chief economist, on Monday, reported Business Insider. The impact has been particularly severe for young tech workers, with the unemployment rate for 20- to 30-year-olds in tech rising by nearly 3 percentage points since early 2024. This is over four times the increase in the overall jobless rate. The rise in unemployment among young tech workers is seen as a clear indication that generative AI is starting to displace white-collar jobs, particularly among early-career workers. See Also: Palantir Q2 Earnings: Revenue, EPS Beat Estimates, Company Raises Guidance Citing 'Astonishing Impact' Of AI Leverage Goldman Sachs estimates that generative AI will eventually displace 6-7% of all US workers, a shift expected to occur over the next decade. The firm forecasts that the peak unemployment impact will be limited to a "manageable" 0.5 percentage point, as other industries absorb many displaced workers. Why It Matters: The impact of AI on the job market has been a topic of concern for some time. In a recent development, Bill Gates warned that AI is advancing at a pace that "surprises" even him, creating uncertainty about when AI might replace human workers across industries. Earlier, on July 17, Cathie Wood of ARK Invest also raised concerns about the impact of AI on the job market, especially for new college graduates. She pointed to troubling labor market trends, citing The Wall Street Journal's reporting on new grads struggling to land jobs. However, not everyone shares these concerns. David Sacks, the White House AI and crypto czar, and Balaji Srinivasan, a Silicon Valley investor, have argued that the narrative of AI-driven job displacement is overhyped. They say that humans remain essential, guiding and verifying AI at both ends of the workflow. Read Next: Dormant Bitcoin Whale Awakens After 14 Years, Moves $469.8 Million Worth of BTC Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo courtesy: Shutterstock GSThe Goldman Sachs Group Inc$727.200.16%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentum85.60Growth59.52Quality48.57ValueN/APrice TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs