services, and finance" - and the worst-hit demographic - "young people entering the workforce after finishing college" - point to that.
Tech journalist Brian Merchant, "The AI jobs crisis is here, now," May 2, 2025:
https://www.bloodinthemachine.com/p/the-ai-jobs-crisis-is-here-now
It’s unclear whether these kinds of layoffs are enough to register in the economic data, though there are signs it is. Writing in the Atlantic this week, business journalist and abundist Derek Thompson points to an alarming phenomenon in the job market: The unemployment rate for recent college graduates is unusually high—and historically high in relation to the general unemployment rate. Why might that be? One theory: Firms are hiring fewer grads into white collar jobs, and using more AI. “When you think from first principles about what generative AI can do, and what jobs it can replace, it’s the kind of things that young college grads have done,” as the Harvard economist David Deming told Thompson.
Young grads are typically among the easiest to employ; they’re skilled, ambitious, and will work for cheap. Yet the recent grad-gap—the “difference between the unemployment of young college graduates and the overall labor force”—is higher than it’s been in four decades. Thompson points to the following graph, made with data from the US Census Bureau and the Bureau of Labor Statistics:
-see the article for the graph-
Here’s Thompson:
The strong interpretation of this graph is that it’s exactly what one would expect to see if firms replaced young workers with machines. As law firms leaned on AI for more paralegal work, and consulting firms realized that five 22-year-olds with ChatGPT could do the work of 20 recent grads, and tech firms turned over their software programming to a handful of superstars working with AI co-pilots, the entry level of America’s white-collar economy would contract.
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