College grads are seeking their first jobs. Is AI in the way?

The arrival of summer always brings an influx of freshly minted college graduates into the job market. This year is different: Artificial intelligence is unsettling the career paths of young grads looking for their first professional work.

AI could "upend entry-level work" for new college grads by automating jobs "previously performed by low-level employees" like legal assistants or early career computer programmers, said ABC News. Some of those jobs will simply disappear, while others will change in significant ways. But it does suggest the "career ladder is being broken," said University of Pennsylvania professor Lynn Wu. It's already a rough time for young professionals: The jobless rate for recent grads is 5.8%, the highest since 2021.

How bad is it for college grads?

Not good. It's not just the unemployment rate, but also the "underemployment" rate — 41.2% of new grads are working jobs that don't require their degrees, said NBC News. That's up nearly a full percentage point from a year ago. Internship postings are down 11% from last year. The job market for young professionals is "pretty frozen," said Allison Shrivastava, an economist at Indeed Hiring Lab. Some of that is due to President Donald Trump's trade wars. Businesses and workers are "both kind of deer-in-headlights, not sure what to do."

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And it may get worse. AI could "wipe out half of all entry-level white-collar jobs" in the next few years, said Axios. The warning of a "white-collar bloodbath" came from Dario Amodei, CEO of Anthropic, "one of the world's most powerful creators of artificial intelligence." Most Americans are "unaware that this is about to happen," said Amodei. Trump adviser Steve Bannon said the issue will be a major issue in the 2028 presidential election. Entry-level jobs are "going to be eviscerated," he said.

What happened to 'learn to code?'

Until recently, that was the conventional advice to young people wanting to ensure their long-term viability in the marketplace. No more. AI is "prompting technology companies to hire fewer recent college graduates," said USA Today. Overall, tech companies are "hiring about half the software developers they used to" because AI is "handling basic software development tasks." Microsoft, which just underwent a round of layoffs, says 30% of its code is written by artificial intelligence.

Is there any reason for optimism?

Optimists say the job market will be reshaped but not destroyed, per CNBC. When an industrial revolution comes along, there are "more jobs created than lost," said Carol Stubbings, an executive with PwC professional services firm. The types of jobs and skills needed to do them will change, however, which means "workers need to be prepared to take them."

That may not help recent grads. The problem for companies is that replacing entry-level workers with AI could lead them to "underinvest in job training, mentorship and other programs" that help new professionals, said Kevin Roose at The New York Times. Businesses will be hurt when the workers they do hire are "unprepared for more senior roles later on."