AI Drives Steep Drop in Entry-Level Employment

(MENAFN) Job opportunities for young professionals in industries impacted by artificial intelligence have plunged 13% nationwide over the past three years, according to a new analysis from the Stanford Digital Economy Lab. The findings signal a swift and potentially disruptive shift in the early-career labor market driven by the rapid adoption of smart technologies.

A recent report from the Stanford Digital Economy Lab identifies a sharp decline in entry-level job opportunities across industries that are becoming increasingly influenced by automation.

Researchers caution that smart technologies are rapidly transforming the job landscape for entry-level workers. They indicate that the current slowdown in hiring for recent graduates could be an early signal of broader employment disruptions as AI adoption continues to accelerate across industries.
The analysis singles out four key fields—software development, customer service, accounting, and administrative support—as experiencing the steepest declines. Workers aged 22 to 25 are being disproportionately affected, with employment in these roles falling 6% since late 2022. Entry-level software developers are feeling the brunt of this trend, with job postings for that group down by a striking 20%.

In stark contrast, older professionals in the same industries have seen employment gains of 6–9% over the same period, suggesting that early-career talent is being selectively squeezed out as automation replaces lower-tier functions.

Notably, young workers in less AI-exposed sectors such as logistics, maintenance, and hands-on trades are faring better. These industries have posted a 6–13% rise in entry-level hiring, indicating a divergent labor market where automation-resistant roles are becoming safe havens for new graduates.

The report emphasizes that job losses are concentrated in positions where AI automates tasks outright, while roles where AI acts as a tool to enhance productivity are still expanding.

Researchers considered other macroeconomic influences but determined that AI-driven automation remains the primary culprit behind the shift. The most dramatic changes began surfacing in late 2022, aligning with the launch of powerful generative AI platforms.

The report identifies the November launch of ChatGPT as a pivotal moment that significantly accelerated shifts in job demand, marking the beginning of a rapid transformation in the labor market.

The findings are based on employment data provided by ADP, the largest payroll software provider in the United States, which tracks labor patterns across millions of workers and tens of thousands of companies.

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