The first AI job cuts are already here

A robot sits at a desk while people back their belongings in boxes

"The unemployment rate for degree holders ages 22 to 27 hit 5.8% this spring."

(Image credit: Demaerre / Getty Images)

published 3 July 2025

The real-world effects that AI will have on the white-collar workforce are starting to come into focus, said Chip Cutter and Lauren Weber in The Wall Street Journal. Last week, Amazon CEO Andy Jassy jolted employees with a note that AI "will eliminate the need for certain jobs" in the next few years. And he wasn't talking about the warehouse workers or drivers typically seen as the most susceptible to automation. "Revenue per employee" is being carefully scrutinized as bosses reconsider what computers can do faster and more cheaply than humans. Procter & Gamble said this month that it was eliminating 7,000 corporate jobs "to create broader and smaller teams," while Estée Lauder and Match Group have recently "jettisoned around 20% of their managers." All told, "about 1 in 5 S&P 500 companies have fewer employees today in both offices and the field than a decade ago."

This is the tip of the iceberg, said Kevin Roose in The New York Times. Firms are making "rapid progress toward automating entry-level work," to the point where one tech executive said his company had completely stopped hiring any engineers below a mid-level position "because lower-level tasks could now be done by AI." It's not long before these techniques will be used to automate work in dozens of other occupations too. The evidence is showing up first in the dried-up job market for new college grads, said Claire Ballentine in Bloomberg Businessweek. "The unemployment rate for degree holders ages 22 to 27 hit 5.8% this spring," the highest level in about four years. The struggle is especially pronounced for recent computer engineering majors, where the unemployment rate is now 7.5%. But the hiring pullback goes beyond tech. In fact, it's harder "to land an entry-level role at one of the big banks than it is to get into Harvard University."

"Is it a bad thing if graduates lose their privileges?" asked The Economist. Ethically, perhaps not. But historically, it's an ominous sign when the highly educated are left idling. The "over-production" of disaffected graduates has signaled social upheaval all the way back to the 19th century. Both in the U.S. and in Europe, what had been safe fields like banking and the law need fewer new recruits. If kids need a job, the skies are hiring, said Leslie Josephs in CNBC.com. The aviation industry is desperate for young workers. "The average age of a certified aircraft mechanic in the U.S. is 54, and 40% of them are over 60." It's going to leave the U.S. aircraft industry short 25,000 technicians by 2028. Median pay for an aircraft technician was $79,140 a year in 2024, and it's rising quickly "with skilled workers in short supply." And AI hasn't learned how to handle a drill—yet.