No more new employees if AI can do the job.
That’s what Shopify At the beginning of this year, CEO Tobi Lütke told the employees in a memo. And he’s not alone.
Gone at Consulting Giant McKinseyThousands of AI agents were used throughout the company who often record tasks that were previously treated by Junior employees. At “Ai-First” Duolingo, CEO Luis from Ahn uses “Ai Fluency” to determine who is hired and promoted in the company.
During the rest of the Fortune 500, companies are very much in their AI efficiency -Fära and mean for many more cuts and fewer attitudes.
It may not be a surprise that some recent data has pointed out that the AI becomes one of the top drivers of attorney reducing.
In the USA in the first seven months of 2025 alone, the assumption of generatives was directly associated with over 10,000 job cuts, so On new data from Outplacement company Challenger, Gray & Christmas. This year the company is the AI among the five most important causes of reducing the workforce.
Diautens are on the rise
According to Challenger, Gray and Christmas, the releases in the USA are increasing in the USA. The technology sector was the hardest with more than 89,000 layoffs in the industry. The company found that since 2023, more than 27,000 technical jobs have been attributed directly to a AI-controlled redundancy, since companies rationalize and restructure the departments.
At the same time, companies become more selective about who and where they set. Entry rolls are the worst of these effects, since the technology is always good in automating work at the junior level. Many companies see simple cost reduction options at the entry level.
“Many entry -level work, if they are fresh outside of college, are knowledge -intensive Assets. “AI can do that quite well and I have heard that many managers say things like:” We can reduce our entry number. “… The greatest disturbance is probably with these employees on a low level, especially if the work is predictable, technically versed or more general.”
After handshake, A generated career platform, the entry-level job advertisements, especially in corporate functions, fell by 15% compared to the previous year. At the same time, the number of employers who have shown “AI” in job descriptions in the past two years has increased by 400%.
Gen z graduates feel the squeez
Almost half of the job seekers of gene Z in the USA say that they believe that artificial intelligence has made their degrees less valuable, so loudly to a recently carried out survey. Fresh graduates also look for a tight job market. The unemployment rate for the latest college The graduates rose in the 12 to an estimated 6% Months before May, significantly higher than the national Average of around 4%.
Young employees in the technology sector feel some of the worst of slowing down the industry. The unemployment rate for those aged 20 to 30 in the sector has increased by around 3% since the beginning of the year. According to Joseph Briggs, Senior Global Economist at Goldman Sachs.
“This is a much greater increase than we saw in the technology sector or among other young workers,” said Briggs on the bank’s bench Exchange Podcast this week.
Cutting on the start can be useful for a company’s end. Organizations that press too much attitude at the entry level were able to backfire this strategy in the long term.
“When many companies cut, cut, cut, cut, the fear that they could actually miss the talent that their pipeline will generate for the future will actually miss the managers, managers, etc.,” said Botelho.
The job market hits a wall
The long -standing fears about AI who eat in final jobs were not supported by the latest work statistics.
The US labor market showed signs of a serious slowdown in July with weaker than expected employment growth and downward revision for the previous months. Economists largely attributed the stable to the uncertainty of business uncertainty, which was carried out by continuing tariff changes under President Trump to invest or rent companies.
In March, the unemployment rate for Americans, trained on College, reached 5.8%of 5.8%, according to the Federal Reserve Bank of New York, the highest level in four years. For some, the number that is well above the national average served as confirmation that the AI Jobs was already available Apocalypse.
In addition to a slowdown in the US economy, however, the decline in job advertisements of the entry-level class, which makes it difficult to separate the effects of AI from larger market forces. For example, Oxford Economics estimates that 85% of the recent increase in unemployment is due to new labor market participants who have difficulty finding jobs, and not necessarily the elimination of jobs across the board.
AI-controlled or not, the US economy suffers from a generation squeeze because the people who are currently entering the workforce are exposed to higher barriers and fewer options.
