In this edition of "Office Optional with Larry English," Larry talks about how AI is affecting entry-level jobs and what that means for the future of white-collar work.

AI is destroying the “bottom rungs of the career ladder,” said Aneesh Raman, LinkedIn’s chief economic officer, in a New York Times op-ed. Anthropic CEO Dario Amodei issued a similar warning, predicting that AI could severely slash the number of entry-level jobs in just five years.

The data supports these dire predictions: A report published by SignalFire, an early-stage venture capital firm, in May found that new grad hiring dropped 50 percent in 2024 compared to pre-pandemic levels. Another report published in May, this one from Oxford Economics, found that for the first time in 45 years, recent college grads have a higher unemployment rate than the national average.

Clearly technology plays a role in the plummeting job market for new grads. Will organizations suffer a future leadership gap if they don’t develop new talent? And what — if anything — can young people do to AI-proof their careers? There is hope.

Is AI Why Companies Aren’t Hiring New Grads?

AI adoption is certainly one reason why hiring rates for new graduates are down. A LinkedIn survey, for example, found that more than 60 percent of executives plan to use AI to shoulder entry-level work. The whole picture, however, is a little more nuanced.

Dr. Heather Doshay, head of talent at SignalFire, points to a domino effect of economic pressures. AI adoption making teams more efficient and a surplus of experienced workers following an uptick in layoffs, especially in the tech sector. When companies have the choice between hiring someone with a few years under their belt or a new graduate who will need investment and training, they’re often opting for the more senior employee — a trend known as the experience paradox.

“We’re in a period of economic recalibration,” Doshay told me in an interview. “In 2021, with the Great Resignation, we saw companies really investing in hiring and growth. Now, because of various factors, startups are 20 percent smaller than they were in 2020. We can’t point to what percentage of that is from AI. We just know AI is a factor as something like 40 percent of employers expect to reduce their workforce where AI can automate tasks.”

Will AI Destroy The White Collar Career Ladder?

Doomsday predictions are good for getting people to sit up and pay attention. But when it comes to AI, the reality will probably end up being less disastrous for white-collar workers.

Although AI is a revolutionary technology, perhaps unlike anything we’ve seen before, history has shown us repeatedly that new technology destroys some jobs while creating others. And, in the end, the job market recalibrates.

So what does the future hold now that AI is on the scene? Doshay predicts that AI-powered teams will remain leaner, as fewer people will be needed to produce the same output. Some of that job loss from leaner teams will be made up by a greater proliferation of companies, enabled by AI.

“One thing that’s really compelling about AI is that you don’t need to be an expert software engineer to build an application,” Doshay says. “Between no-code and AI improvements, almost anyone can start a business.”

And while AI will eventually eliminate some job categories, it will also create new opportunities and the need for new subspecialties, especially in areas like cybersecurity, data engineering and AI oversight.

And what does this all mean for organizations and their leadership pipelines? On the surface, it makes sense that if companies aren’t hiring new graduates, they will see a weakened leadership pipeline in the future. However, this assumption may be misguided, Doshay says. If AI is leading to smaller teams, then organizations won’t require as many leaders in the future.

Plus, the next generation will be AI natives, and they may help organizations sidestep any leadership gap. “Will companies actually feel the gap of not having invested in this subsector of a generation?” Doshay asks. “I’m not sure, to be honest. I feel for these people who are being impacted, but there could be a world where we don’t feel the emptiness at all for companies.”

Even if the leadership pipeline isn’t negatively effected, companies will still need to invest in training new employees, especially junior team members. AI skills are important, but they’re not everything. Developing intuition, understanding how the business and industry works and understanding how to navigate within an organization are all skills that only come from getting a few years of experience or through formal training.

To stay competitive in an AI-driven economy, organizations should also start thinking about how entry-level work needs to be changed to align with our new AI-powered reality. In an interview with PBS News, LinkedIn’s Raman shared examples of some organizations that are already starting to change entry-level work:

“KPMG is now giving new grads higher level tax work that used to go to people that had, I think two or three years’ worth of experience because AI is handling a lot of the grunt work,” he said, adding that the British law firm MacFarlanes is also training early career lawyers on complex contract interpretation, not just basic document review.

"All we need to do on the employer side is up level the tasks that we give entry level workers and be more deliberately appreciative of the know how they bring," Raman told PBS.

What Young People Should Do To AI-Proof Their Careers

Even if organizations don’t feel the effects of a weakened leadership pipeline, there is still an entire generation of young adults feeling the transitional squeeze as AI use ramps up while companies are working with leaner budgets.

That said, there are steps recent graduates and college students can take to aid their career success in an AI-powered world:

• Master AI tools. Don’t just learn how to use them, learn how to fix AI flaws.
• Pursue internships and networks to build a strong personal network.
• Engage in bootcamps, creative side projects and freelancing work to demonstrate value in a shifting job market.
• Your major matters less than being adaptable and collaborative.
• Focus on developing the skill of discernment, not just technical skills.

This last point — developing discernment — will be crucial, Doshay says. The ability to judge, curate, and refine AI output will be the new ultimate (and human) competitive advantage.

“A future job state for a lot of us is going to be quality control and quality assurance on the work of AI agents, so we’ll have to understand what is passable and what is good," Doshay added. "If you’re an experienced professional, say a software engineer, can you look at a few lines of code and understand if it’s good or not? Will this break? Should this be implemented into our product? Or if you’re a writer, you could ask AI to write for you, but then you need to decide if the output is good, does it prove a point?”

AI is changing the game for early-career professionals. The traditional career ladder may be in a transitional state, but new paths are emerging for those who know how to navigate them. Young professionals who build strong networks, learn to work alongside AI, and sharpen their ability to think critically and adapt quickly will still find opportunities. At the same time, organizations need to rethink how they nurture early talent. By redesigning entry-level roles to focus on higher-value work and embracing the unique perspective AI-native employees bring, companies can build stronger, more future-ready teams.

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