AI's Impact on Entry-Level Jobs and Career Progression: Reshaping the Corporate Ladder

AI is not just ending entry-level jobs. It's the end of the career ladder as we know it

Mail room clerk with boxes for delivery4x6 | Istock | Getty Images Current CEO of Hewlett Packard Enterprise Antonio Neri rose from call center agent at the company to chief executive officer. Doug McMillon, Walmart CEO, started off with a summer gig helping to unload trucks. It's a similar story for GM CEO Mary Barra, who began on the assembly line at the automaker as an 18-year old. Those are the kinds of career ladder success arcs that have inspired workers, and Hollywood, but as AI is set to replace many entry-level jobs, it may also write that corporate character out of the plot. The rise of AI has coincided with considerable organizational flattening, especially among middle management ranks. At the same time, Anthropic CEO Dario Amodei is among those who forecast 50% of entry-level jobs may be wiped out by AI as the technology improves, including being able to work eight-hour shifts without a break. All the uncertainty in the corporate org chart introduced by AI -- occurring at a time when college graduates are struggling to find roles -- raises the question of whether the career ladder is about to be broken, and the current generation of corporate leaders' tales of ascent that have always made up an important part of the corporate American ethos set to become a thing of the past. If the notion of going from the bottom to the top has always been more the exception than the rule, it has helped pump the heart of America's corporations. In the least, removing the first rung on the ladder raises important questions about the transfer of institutional knowledge and upward advancement in organizations. Looking at data between 2019 and 2024 for the biggest public tech firms and maturing venture-capital funded startups, venture capital firm SignalFire found in a study there was a 50% decline in new role starts by people with less than one year of post-graduate work experience: "Hiring is intrinsically volatile year on year, but 50% is an accurate representation of the hiring delta for this experience category over the considered timespan," said Asher Bantock, head of research at SignalFire. The data ranged across core business functions -- sales, marketing, engineering, recruiting/HR, operations, design, finance and legal -- with the 50% decline consistent across the board. But Heather Doshay, partner at SignalFire, says the data should not lead job seekers to lose hope. "The loss of clear entry points doesn't just shrink opportunities for new grads -- it reshapes how organizations grow talent from within," she said. If, as Amodei told CNBC earlier this year, "At some point, we are going to get to AI systems that are better than almost all humans at almost all tasks," the critical question for workers is how the idea of an entry-level job can evolve as AI continues to. Flatter organizations seem certain. "The ladder isn't broken -- it's just being replaced with something that looks a lot flatter," Doshay said. In her view, the classic notion of a CEO rising from the mailroom is a perfect example since at many company's it's been a long time since anyone worked in an actual mailroom. "The bottom rung is disappearing," she said, "but that has the potential to uplevel everyone." The new "entry level" might be a more advanced or skilled role, but with the upskilling of the bottom rung, pressure is being created for new grads to acquire these job skills on their own, rather than being able to learn them while already on a job they can't land today. That should not be a career killer, though, according to Doshay. "When the internet and email came on the scene as common corporate required skills, new grads were well-positioned to become experts by using them in school, and the same absolutely applies here with how accessible AI is," she said. "The key will be in how new grads harness their capabilities to become experts so they are seen as desirable tech-savvy workers who are at the forefront of AI's advances," she said. But she concedes that may not offer much comfort to the current crop of recent grads looking for jobs right now. "My heart goes out to the new grads of 2024, 2025, and 2026, as they are entering during a time of uncertainty," Doshay said, describing it is a much more vulnerable group entering the workforce than ones further into the future. Universities are turning their schools into AI training grounds, with several institutions striking major deals with companies like Anthropic and OpenAI. "Historically, technological advancements have not harmed employment rates in the long run, but there are short-term impacts along the way," Doshay said. "The entry-level careers of recent graduates are most affected, which could have lasting effects as they continue to grow their careers with less experience while finding fewer job opportunities," she added. Anders Humlum, assistant professor of economics at the University of Chicago, says predictions about AI's long-term labor market impact remain highly speculative, and firms are only just beginning to adjust to the new generative AI landscape. "We now have two and a half years of experience with generative AI chatbots diffusing widely throughout the economy," Humlum said, adding "these tools have really not made a significant difference for employment or earnings in any occupation thus far." Looking at the history of labor and technology, he says even the most transformative technologies, such as steam power, electricity, and computers took decades to generate large-scale economic effects. As a result, any reshaping of the corporate structure and culture will take time to become clear. "Even if Amodei is correct that AI tools will eventually match the technical capabilities of many entry-level white-collar workers, I believe his forecast underestimates both the time required for workflow adjustments and the human ability to adapt to the new opportunities these tools create," Humlum said. But a key challenge for businesses is ensuring that the benefits of these tools are broadly shared across the workforce. In particular, Humlum said, his research shows a substantial gender gap in the use of generative AI. "Employers can significantly reduce this gap by actively encouraging adoption and offering training programs to support effective use," he said. Other AI researchers worry that the biggest issue won't be the career ladder at the lowest rung, but ultimately, the stability of any rung at all, all the way to the top. If predictions about AI advancements ultimately leading to superintelligence are proven correct, Max Tegmark, president of the Future of Life Institute, says the issue isn't going to be about whether the 50% entry-level jobs being wiped out is accurate, but that percentage growing to 100% for all careers, "since superintelligence can by definition do all jobs better than us," he said. In that world, even if you were the last call center, distribution center or assembly line worker to make it to the CEO desk, your days of success might be numbered. "If we continue racing ahead with totally unregulated AI, we'll first see a massive wealth and power concentration from workers to those who control the AI, and then to the machines themselves as their owners lose control over them," Tegmark said.

Silicon Valley's graying workforce: Gen Z staff cut in half at tech companies as the average age goes up by 5 years

Gen Z are digital natives raised in the era of YouTube, Tumblr, Instagram, and Facebook; and now, they're some of the strongest AI users in their personal and professional lives. But Silicon Valley tech companies looking to make waves with AI aren't holding onto the digitally savvy generation -- instead, they're actively boxing them out. The percentage of young Gen Z employees between the ages of 21 and 25 has been cut in half at technology companies over the past two years, according to recent data from compensation management software business Pave with workforce data from more than 8,300 companies. These young workers accounted for 15% of the workforce at large public tech firms in January 2023. By August 2025, they only represented 6.8%. The situation isn't pretty at big private tech companies, either -- during that same time period, the proportion of early-career Gen Z employees dwindled from 9.3% to 6.8%. Meanwhile, the average age of a worker at a tech company has risen dramatically over those two and a half years. Between January 2023 and July 2025, the average age of all employees at large public technology businesses rose from 34.3 years to 39.4 years -- more than a five year difference. On the private side, the change was less drastic, with the typical age only increasing from 35.1 to 36.6 years old. Millennials are currently ruling the tech industry and clinging to their roles as the economy is rocked by uncertainty due to tariffs, inflation increases living expenses, and AI swipes jobs. Meanwhile, entry-level Gen Zers are just hoping to get their careers off the ground. "If you're 35 or 40 years old, you're pretty established in your career, you have skills that you know cannot yet be disrupted by AI," Matt Schulman, founder and CEO of Pave, tells Fortune. "There's still a lot of human judgment when you're operating at the more senior level...If you're a 22-year-old that used to be an Excel junkie or something, then that can be disrupted. So it's almost a tale of two cities." Schulman points to a few reasons why tech company workforces are getting older and locking Gen Z out of jobs. One is that big companies -- like Salesforce, Meta, and Microsoft -- are becoming a lot more efficient thanks to the advent of AI. And despite their soaring trillion-dollar profits, they're cutting employees at the bottom rungs in favor of automation. Entry-level jobs have also dwindled because of AI agents, and stalling promotions across many agencies looking to do more with less. Once technology companies weed out junior roles, occupied by Gen Zers, their workforces are bound to rise in age. And experts tell Fortune that spells a lot of trouble for innovation and long-term business stability. The rapid disappearance of Gen Z at large technology companies is a dog whistle to what's really going behind the scenes -- AI is automating roles, from entry-level upwards. But what's worrying about their presence disappearing faster at large public companies is the fact that early career pipelines are being completely disrupted. And they're often the businesses with enough equity to invest in these Gen Z-targeted talent initiatives in the first place. "Most public companies have fleshed out training programs that are squarely centered around new grad programs and university recruiting," the Pave CEO, with early-career experience at Facebook and Microsoft, explains. "A company like Meta, their whole talent thesis was to go after universities, get the smart 21-year-olds, and then train them up. It's just not as relevant as a paradigm for private companies." Jeri Doris, chief people officer at software company Justworks, tells Fortune workforce reductions have created a difficult barrier for Gen Z. Businesses are striving to do more with less, cutting entry-level roles and striving for AI automation to save on headcount costs. Mass firings have wiped whole corporate departments across the U.S., as companies announced more than 806,000 job cuts from January through the end of July this year, according to a report from Challenger, Gray & Christmas. It's a 75% spike from the approximately 460,000 reductions announced through the first seven months of last year. "Mass tech layoffs and a reduction in entry-level jobs means it's harder for Gen Z to find open roles to apply for," Doris explains. "On the flip side, Gen Z is prioritizing flexible working, job stability and work-life balance -- something the tech industry may not be able to offer -- so they're applying to roles in different industries." As thousands of Gen Z are shut out making a name in the industry -- even just getting a foot in the door -- there could be serious long-term impacts. In the near future, many CEOs may espouse the money-saving potential of automating entry-level jobs. But looking 10 or 20 years ahead, when technology companies' current millennial workers progress towards senior roles, there's the question of who will take over their mid-level jobs. If Gen Z don't have the opportunity to learn from the bottom-up, there presents a major issue of stifled innovation and a lack of talent ready to step into those positions. Pave CEO Schulman uses sales roles as an example: "There's a very linear, structured path that exists across like almost every tech company. You start doing the junior-level outbound sourcing work, then you become a mid-market account executive, then you become an enterprise seller. Enterprise sellers, in my opinion, will not be disrupted by AI anytime soon." "Enterprise sellers are still needed, but you're removing the roles beneath them on that career hierarchy. How are we going to train the future of enterprise sellers, if they aren't going through the conventional steps to get there?" While the situation looks scary for Gen Zers looking to get a job at a tech firm, experts tell Fortune they should leverage the assets they have. Being new to the industry can even work to their advantage. "[Companies] can hire a 21, 22-year-old that has not been brainwashed by years of corporate America. And instead, can just break the rules and leverage AI to a much greater degree without the hindrance of years of bias," Schulman says. "I do think there is a new crop of these young ones that are just really leveraging AI maximally." To be a highly sought-after worker in this AI-automated era, that means being "manically" focused on all the new models that come out. Gen Z should study how to prompt chatbots extremely effectively, and even create bespoke models for their lines of work. Priya Rathod, workplace trends editor for LinkedIn, also tells Fortune that the young professionals shouldn't give up on the tech industry. Instead, they should rethink their path within it -- upskilling and taking on new career pathways can be a strong point of entry. Lucky for Gen Z, they don't have to go back to college to get an upper-hand in the talent market. "Building skills through certifications, gig work, and online communities can open doors," Rathod recommends. "Roles in UX, AI ethics, cybersecurity, and product operations are promising entry points. Instead of waiting for opportunities, they should create them -- through freelance projects, networking, and showcasing work online." "Employers are increasingly rethinking traditional degree requirements. For Gen Z, the right certifications or micro credentials can outweigh a lack of years on the resume. This helps them stay competitive even when entry level opportunities shrink."

I'm chief legal officer at a $4 billion IT unicorn and I've got Gen Z advice for leaders looking to reimagine entry-level work in the age of AI

LinkedIn's chief economic opportunity officer recently warned that AI is "breaking" entry-level jobs that have historically served as stepping stones for young workers. As Aneesh Raman wrote in The New York Times, "Breaking first is the bottom rung of the career ladder." AI tools are performing simple coding and debugging tasks that junior software developers once did to gain experience, along with work that young employees in the legal and retail sectors traditionally handled. Wall Street firms are also reportedly considering steep cuts to entry-level hiring in light of this. The implications go way beyond individual hardship -- they threaten the foundation of how organizations build expertise, maintain security and sustain innovation. However, there are things all organizations can do now to help. Hasty AI adoption at the expense of hiring and developing human workers creates serious security vulnerabilities. AI is only as effective as its inputs, and the interpretation and action steps that follow are only as sound as the skills and contextual understanding of the people involved. In short: reducing human oversight creates breeding grounds for security gaps. Indeed CEO Chris Hyams recently noted that while AI can't completely replace a job, "for about two-thirds of all jobs, 50% or more of those skills are things that today's generative AI can do reasonably well, or very well." These shifts underscore the urgent need for organizations to take a balanced approach, investing thoughtfully in both emerging technology and human talent. To shape a sustainable future of work, neither people nor progress can be left behind. This challenge is particularly acute in fields like cybersecurity, where gaining hands-on experience is crucial. Today, many cybersecurity roles require experience that young professionals can't acquire because entry-level positions that build that experience no longer exist or have been automated away. An increasing number of cybersecurity job postings list artificial intelligence skills as a requirement. Yet research shows that 44% of professionals say their companies have invested in AI across the organization while employees lack adequate skills and training to use these tools effectively -- meaning professionals are being left behind and there is a gap in the skills needed to manage AI investments correctly. If this is happening now, consider how these changes could reshape our workforce in the next five years and beyond. Heavily leveraging AI while human workers at all levels lack the training and skills to manage it appropriately -- that is a recipe for significant risks. When you can't build a pipeline of talent from the ground up, you end up with senior professionals who lack the diverse perspectives and fresh thinking that come from working alongside newer team members. As organizations increasingly lean on AI to handle tasks once reserved for junior employees, the danger isn't just the disappearance of foundational career steps, it's the erosion of the very systems that foster growth, innovation and security. Overreliance on technology threatens to sever the pipeline that develops future experts, leaving critical gaps in both skills and perspective. LinkedIn COO Dan Shapero says, "When I was at Bain, a lot of the time I spent was making slides and going to the library to figure out research reports. All of that is now automated. Bain still hires scores of recent graduates. They just do different parts of the process." Rather than eliminating entry-level jobs, organizations should reimagine them for a new era -- where early-career professionals are empowered to work alongside AI, learning higher-order skills instead of just routine tasks. Use AI to augment new workers, not replace them. Allow junior employees to focus on strategy, creativity, relationship-building, and complex problem-solving while AI handles routine tasks. This approach requires treating AI like a new hire -- every AI tool should be evaluated, supervised and developed like an employee, not simply deployed and forgotten. Successful workforce transitions require structured evaluation processes for each potential AI use case. This evaluation should include a return-on-investment analysis not just in terms of dollars and hours saved, but also in terms of human impact. When an AI tool eliminates repetitive tasks, the affected employee should be retrained for a more strategic role, making AI a catalyst for internal mobility rather than displacement. Organizations need cross-functional governance that ensures decisions aren't just compliant but human-centered. Representatives from IT, privacy, product, security, and HR should collaborate to balance innovation with workforce development. When GenAI first captured widespread attention in 2023, smart companies built sustainable AI governance models, prioritized transparency and tackled employee displacement through reinvention rather than layoffs. As leaders, we need to ask ourselves: What are we doing to ensure the next generation can build the experience they need to become our future leaders? Here is a starter kit: Develop AI fluency as a core competency. Cultivating AI fluency must become a cornerstone skill for tomorrow's workforce. Increasingly, job candidates will need to demonstrate not only their comfort with AI tools, but also their ability to harness these technologies as proactive problem-solvers and innovators. This is the new generation's biggest advantage in the job market. Invest in apprenticeships and mentorship programs. Create pathways where experienced professionals work directly with newcomers on real projects, not just theoretical training. Career pathing and goal setting can develop internal talent effectively. Support teams can allow engineers to explore different roles within the company, successfully transitioning employees into specialized roles like cybersecurity. Embrace upskilling as a core business function. Teaching current employees new skills is a great start, but that's not even half the challenge here. Let's also approach this by creating new types of roles that didn't exist before. Don't assume competency. (You know what they say about assuming!) Recognize that professionals -- in both new and legacy roles -- need adequate training to use AI tools effectively. Support workforce development initiatives. Creating curricula and engaging with educational institutions can help address skills gaps while supporting corporate social responsibility efforts. Legislative initiatives that enhance accessibility of cyber training and education through scholarship programs for two-year degrees at community colleges and technical schools can strengthen the talent pipeline. Maintain explicit commitments to workforce retention. Even when specific jobs change, it's important to find new places for affected employees within the organization. Why does this matter? It sends the message that reliable AI requires human oversight, and that the goal should be redefining roles rather than eliminating them. (Big difference!) Individual company programs won't resolve all of this, but collective action can make a difference. Instead of looking at this as a massive problem, why not see this as an opportunity to shape how AI transforms work? We can start now, acting deliberately and with the next generation in mind.