AI Is Already Killing Jobs — and Entry-Level Workers Are Taking the Biggest Hit

Goldman Sachs just dropped the receipts: artificial intelligence is starting to squeeze labor markets across the developed world, and the damage is uneven, targeted, and already measurable.

Employment in the most AI-exposed industries has fallen sharply below trend. Call centers, software publishing, management consulting, and advertising are bleeding jobs. Call centers alone are now 39% below trend in the U.S., 33% in Canada, and 27% in Germany. Information and communication services have slowed almost everywhere since late 2022.

The hit is hardest on people trying to break in. Across more than 800 occupations, AI-related headwinds hit entry-level workers hardest. A 10% exposure to AI costs only about 0.1 percentage points of annual headcount growth overall in places like the U.S., France, and Canada. For entry-level roles, that drag jumps to more than 0.2 points in the U.S. and over 0.6 points in Australia.

AI adoption itself is already mainstream: roughly 15–20% across major developed economies. France, the U.S., the Netherlands, and the U.K. lead. Italy, Japan, and New Zealand lag. Emerging markets sit a bit lower, at 10–15%.

Bottom line from Goldman: the AI job pressure is real and visible in the data — but still concentrated in a relatively narrow set of industries and workers. For now.

Here is a polished, streamlined rewrite of the article that sharpens its main arguments and improves readability for scanning.

 Young Grads Blame AI for Their Job Search Struggles. Economists Say It’s Complicated.

Recent college graduates are facing an uphill battle in the job market, and many point the finger at artificial intelligence. However, economists offer a more nuanced view of what is driving the downturn in entry-level hiring.

The Reality on the Ground

Despite completing degrees and submitting hundreds of applications, many young job seekers are struggling to secure entry-level roles:

• High Application Volume, Low Yield: Grads report sending 450 to 500+ applications with minimal job offers.
  
  
• Elevated Unemployment: According to the New York Fed, unemployment for recent graduates (ages 22–27) reached 5.7%, notably higher than the overall national rate of 4.1%.
  
  
• Worker Sentiment: A ZipRecruiter survey reveals 47% of recent grads believe AI is already negatively affecting hiring in their fields.
  
  

Three Perspectives: What Is Really Driving the Trend?

1. AI Is Actively Squeezing Entry-Level Workers

• Expert: Erik Brynjolfsson (Stanford University)
  
  
• The Argument: Brynjolfsson’s research found a 16% relative drop in early-career employment (ages 22–25) in AI-exposed fields like software development and marketing since late 2022. Older workers and non-automatable roles (healthcare, construction) remain stable.
  
  
• Why Junior Roles Suffer: Large Language Models excel at "codified knowledge" (textbook data), which overlaps heavily with entry-level duties. Junior workers lack the "tacit knowledge" and experience that insulate senior employees from automation.
  
  

2. Remote Work—Not AI—Is the True Culprit

• Expert: David Deming (Harvard University)
  
  
• The Argument: The drop in junior hiring began roughly six months before ChatGPT launched. New York Fed data indicates that as remote work rose post-pandemic, companies grew hesitant to hire fresh grads because remote training is difficult and costly.
  
  
• The Shift: Employers prefer hiring experienced talent who can work productively from home without hands-on onboarding.
  
  

3. AI-Heavy Companies Are Actually Hiring More

• Expert: Anders Humlum (University of Chicago)
  
  
• The Argument: Data from Ramp and Revelio Labs analyzing 21,000+ U.S. firms shows that companies spending the most on AI tools (like OpenAI and Anthropic) increased entry-level headcount by 12% over two years post-adoption. Heavy AI implementation correlates with business expansion, not layoffs.
  
  

Key Takeaway

Factor	Primary Impact on Entry-Level Hiring
AI Automation	Replaces basic entry-level tasks based on written data; disproportionately affects early-career workers.
Remote Work	Discourages junior hiring due to high remote-onboarding costs; shifts preference toward senior hires.
AI Adoption	Drives growth at top-performing tech firms, creating new opportunities for early-career hires.

While economists debate the root cause of current hiring friction, all agree that AI will trigger a major economic shift comparable to the Industrial Revolution. Their ultimate message to recent graduates? The transition will be messy, but adapting to these tools will ultimately empower workers rather than destroy their careers.