- Artificial intelligence is rapidly automating entry-level roles, particularly affecting Generation Z workers entering the labour market.
- Traditional pathways into professional careers are eroding, raising youth unemployment rates and creating a paradox between job requirements and experience opportunities.
- Sector-wide shifts are visible, with some industries, like tech and finance, reducing internship offers while demanding higher initial qualifications.
- Economists forecast broader economic implications, including talent shortages in certain sectors and the potential suppression of future consumer spending.
- Proposed solutions include early AI literacy, expanded upskilling efforts, and investment in reskilling infrastructure, amid ongoing concerns of widening social inequality.
Artificial intelligence is reshaping the labour market in profound ways, with entry-level positions increasingly vulnerable to automation, posing significant challenges for Generation Z workers entering the workforce. As AI tools automate routine tasks such as data entry, basic analysis, and administrative duties, the traditional pathways that allowed young professionals to gain essential experience are eroding, potentially leading to higher youth unemployment and delayed career progression.
The Rise of AI and Its Impact on Entry-Level Roles
Recent analyses highlight how AI is transforming the foundational rungs of the career ladder. Entry-level jobs, which have long served as training grounds for developing workplace skills, are being automated at an accelerating pace. For instance, roles involving report generation, research summaries, and basic coding are now handled by AI systems with greater efficiency and lower cost. This shift is not merely technological; it represents a structural change in how companies onboard and develop talent.
According to reports from credible sources, AI’s disruption is particularly acute for recent graduates. The automation of tasks that once required human oversight means fewer opportunities for hands-on learning. In sectors such as technology, finance, and marketing, positions that demanded minimal experience are now either eliminated or require advanced skills from the outset. This creates a paradox: employers seek experienced hires, yet the mechanisms for gaining that experience are vanishing.
Historical context underscores the novelty of this trend. In previous decades, entry-level roles accounted for a significant portion of job growth, with data from the early 2000s showing that such positions comprised up to 30% of new hires in white-collar industries. Today, however, AI-driven efficiencies are compressing these opportunities. A 2023 study by the World Economic Forum projected that by 2027, AI could displace 85 million jobs globally, many of them entry-level, while creating 97 million new ones — though these new roles often demand higher skill levels, leaving a gap for inexperienced workers.
Gen Z’s Unique Challenges in a Transforming Job Market
Generation Z, born between 1997 and 2012, is entering the workforce amid this upheaval. Unlike previous generations, they face a market where AI not only competes for jobs but also screens applications through automated systems, further complicating entry. Sentiment from industry experts indicates growing concern. For example, LinkedIn executives have warned that the “bottom rung of the career ladder” is breaking, with AI automating the very tasks that built foundational skills.
This disruption is exacerbating youth unemployment rates. In the United States, as of mid-2025, unemployment among those aged 18–24 stands at around 12%, higher than the national average, partly attributed to AI’s role in reducing entry-level openings. Globally, the International Labour Organization noted in its 2024 report that AI could widen inequality by disproportionately affecting younger workers in developing economies, where entry-level jobs in services and tech are rapidly evolving.
Moreover, the skills mismatch is stark. Gen Z workers are often tech-savvy, yet AI demands proficiency in overseeing these tools rather than performing the tasks they automate. Bill Gates, in a recent interview, emphasised that even mastering AI may not shield young workers from job losses, as automation targets the predictability of entry-level work. This sentiment aligns with Goldman Sachs analyses, which label Gen Z tech workers as the most vulnerable, predicting that entry-level tech roles could decline by up to 20% in the next five years due to AI integration.
Economic Implications and Broader Market Effects
The erosion of entry-level jobs carries ripple effects across the economy. For investors, this trend signals shifts in labour costs and productivity. Companies adopting AI can reduce headcount in junior roles, potentially boosting margins in the short term. Analyst models from firms like Deloitte forecast that AI could add $15.7 trillion to global GDP by 2030, with labour productivity gains accounting for much of this. However, this comes at the cost of social mobility, as delayed workforce entry for Gen Z could suppress consumer spending and innovation in the long run.
In the tech sector, where AI disruption is most pronounced, companies such as those in software development and data services are seeing internship offers drop by nearly 50% compared to pre-2020 levels, per industry reports. This scarcity forces graduates to pivot to non-traditional paths, such as gig economy roles or further education, which may not align with long-term career goals. From an investment perspective, firms heavily investing in AI — think automation leaders — stand to gain, but sectors reliant on young talent pipelines, such as consulting and finance, may face talent shortages.
Forecasts from economist-led models at Goldman Sachs suggest that without intervention, Gen Z unemployment could rise by 5–7% in AI-heavy industries by 2030. This is labelled as a conservative estimate, assuming moderate AI adoption rates. On the sentiment front, verified sources report a prevailing pessimism among young workers, with many feeling “cooked” in the job market due to AI screening and layoffs.
Potential Solutions and Adaptive Strategies
Addressing this disruption requires multifaceted approaches. Policymakers could incentivise companies to maintain apprenticeship programmes, blending AI tools with human mentoring. Education systems must evolve, incorporating AI literacy from an early stage to prepare Gen Z for oversight roles rather than execution ones. Upskilling initiatives, such as those proposed by the World Economic Forum, aim to retrain workers for AI-augmented jobs, potentially mitigating up to 40% of projected displacements.
For investors, opportunities lie in education technology and reskilling platforms. Companies offering AI training courses have seen valuation multiples expand, reflecting market bets on sustained demand. However, risks remain: if Gen Z’s career stagnation leads to broader economic slowdowns, consumer-facing sectors could suffer.
In essence, AI’s assault on entry-level jobs is a double-edged sword — driving efficiency while challenging the next generation’s prospects. As this unfolds, the onus is on stakeholders to foster inclusive growth, ensuring technological progress does not come at the expense of opportunity.
References
- Breitbart. (2025, August 9). Goldman Sachs: Generation Z tech workers are hit hardest by AI disruption. https://www.breitbart.com/tech/2025/08/09/goldman-sachs-generation-z-tech-workers-are-hit-hardest-by-ai-disruption/
- Fortune. (2025, May 25). AI threatens entry-level jobs: LinkedIn execs warn of broken career ladders. https://fortune.com/2025/05/25/ai-entry-level-jobs-gen-z-careers-young-workers-linkedin/
- Fortune. (2025, August 4). Bill Gates warns Gen Z about AI’s impact — proficiency may not be enough. https://fortune.com/2025/08/04/ai-is-coming-for-entry-level-jobs-bill-gates-says-gen-z-may-not-be-safe-no-matter-how-well-they-learn-to-use-it/
- Fort Worth Inc. AI is gutting entry-level jobs just as Gen Z graduates arrive. https://fortworthinc.com/commentary/ai-is-gutting-entry-level-jobs-just-as-gen-z-graduates-arriv/
- International Labour Organization. (2024). World of Work Report.
- Newsweek. Gen Z entry-level jobs disappearing as AI dominates initial hiring stages. https://www.newsweek.com/gen-z-entry-level-jobs-disappearing-ai-2086537
- People Matters. Goldman Sachs warns entry-level tech jobs may vanish under AI pressure. https://www.peoplematters.in/news/ai-and-emerging-tech/ai-threatens-entry-level-tech-jobs-goldman-sachs-warns-gen-z-workers-42382
- The Economic Times. Top economist warns Gen Z tech workers could be first to lose jobs to AI. https://economictimes.indiatimes.com/news/international/us/top-economist-warns-gen-z-tech-workers-could-be-first-to-lose-jobs-to-ai/articleshow/123193780.cms
- The HR Digest. The Gen Z job crisis grows complicated as AI disrupts entry-level jobs. https://www.thehrdigest.com/the-gen-z-job-crisis-grows-complicated-as-ai-disrupts-entry-level-jobs/
- The Manila Times. When AI takes the entry-level job. https://manilatimes.net/2025/08/18/business/top-business/when-ai-takes-the-entry-level-job/2169179
- The Washington Post. In the job market, Gen Z is cooked. https://www.washingtonpost.com/podcasts/post-reports/in-the-job-market-gen-z-is-cooked/
- World Economic Forum. (2025, April). AI and the future of global employment. https://www.weforum.org/stories/2025/04/ai-jobs-international-workers-day/
- WhatJobs. AI is reshaping the job market. https://whatjobs.com/news/ai-is-reshaping-the-job-market
- AInvest. Gen Z faces challenging job market amid AI layoffs and experience gaps. https://ainvest.com/news/gen-faces-challenging-job-market-ai-layoffs-high-experience-requirements-2508
- Moneycontrol. Bill Gates’ new AI warning for Gen Z raises question: Are traditional jobs safer? https://moneycontrol.com/technology/bill-gates-new-ai-warning-for-gen-z-raises-question-are-traditional-jobs-more-safe-in-2025-article-13411319.html/amp
- X (formerly Twitter). Posts from accounts including unusual_whales, Parallæx, Anand Sanwal, Chubby♨️, Mario Nawfal, The AI Showdown 24×7, Alva, Owen Gregorian, Martin Woods.
