AI Shrinks Entry Level Tech Jobs While Boosting Experienced Hiring

The question of when AI will start replacing human labor has sparked intense debate. While it’s still uncertain if AI is overtaking human roles outright, recent data suggests it’s already reshaping hiring trends, especially in tech.

A World Economic Forum survey found that 40% of employers plan to reduce staff where AI can automate tasks. SignalFire, a data-driven venture capital firm tracking over 600 million employees on LinkedIn, has observed early signs of AI’s impact on hiring patterns.

Their analysis shows that in 2024, tech companies hired significantly fewer recent college graduates compared to 2023. Big Tech firms cut graduate hiring by 25%, while startups reduced it by 11%. Although exact numbers weren’t disclosed, the reduction amounts to thousands of fewer new grads hired.

Why the decline? Entry-level jobs often involve routine, low-risk tasks—precisely the kind generative AI excels at automating. New AI tools can now handle coding, debugging, financial research, and software installation, reducing the need for junior staff.

For example, Gabe Stengel, founder of AI financial analyst startup Rogo, shared how his company’s AI tool performs nearly all the financial analysis work he once did manually at Lazard investment bank. This automation potential has led some major banks to consider drastically cutting junior analyst hiring and lowering salaries.

Yet, while entry-level roles shrink, demand for experienced professionals is rising. SignalFire reports Big Tech increased hiring by 27% for professionals with two to five years of experience, and startups boosted mid-level hires by 14%. This creates a paradox for new graduates: they need experience to get hired, but can’t gain experience without being hired.

Heather Doshay of SignalFire advises new grads to master AI tools, emphasizing that proficiency with AI can safeguard jobs. “AI won’t take your job if you’re the one who’s best at using it,” she says, highlighting the importance of adapting skills alongside technology.

In summary, AI is already reshaping the tech labor market by automating routine entry-level tasks and shifting hiring focus toward experienced talent. This trend challenges new graduates but also opens opportunities for those who adapt quickly to AI-driven workflows.