"Gen Z faces a bloodbath of AI jobs"

Obtaining your first job has never been easy, but this year is making it more difficult than ever

Kaylie Pferten blames artificial intelligence.

It has never been easy to land your first job. It is more difficult than ever this year, though. Indeed, a job website, reports that the labor market for recent graduates is at its worst level since 2018. In September, PWC, a consulting firm that has historically been a major employer, announced that it would be hiring 200 fewer university graduates this year. The UK's stagnant economy isn't helping either. Nevertheless, a similar situation is developing even in the prosperous US. Only 30% of this year's graduates have secured employment in their field, according to research firm Cengage. Although local factors vary from economy to economy, it is evident that something else is happening throughout the developed world: entry-level graduate jobs are being eliminated.

Determining the reason for that is not difficult. The speed at which AI is developing has led to the replacement of a large portion of the labor that was previously performed by recent graduates. Most jobs are still reasonably safe, at least for the time being, especially at higher levels of the career ladder where important decisions are made and real knowledge and insight are typically needed. That type of work is still beyond the capabilities of intelligent bots. Previously, trainees were responsible for tasks like checking spreadsheets at an accounting firm or drafting documents at a law firm, but one of the highly advanced AI systems can now do these tasks flawlessly. Since the first rung of the career ladder has been eliminated by the bots, many graduates are now having difficulty finding work.

For policymakers, that will present a real obstacle. Graduates who are unable to secure employment will see their skills deteriorate, their debt from obtaining their degrees will never be paid back, and they will never have the opportunity to establish fulfilling careers or make a positive impact on the economy. It'll be disastrous.

Many will argue for controls or regulations, but what should be done? They will argue that AI shouldn't be permitted to take the place of human labor or that businesses should continue to hire the same number of people as they did five years ago. There may even be demands for a total ban on AI. Such a neo-Luddism fails. Because AI has the potential to produce enormous increases in productivity across the entire economy, we don't want to slow its development. However, we don't want Gen Z to continue to be unemployed or to bear the full burden of the shift from one technology to another because they were born at the wrong time.

How to stop the slaughter of AI jobs.

The only practical solution for that is to drastically de-regulate the employment market for those under thirty. To grant workers full employment rights from day one, the UK's Labour government has picked the worst possible moment. For recent graduates, it will take an already difficult situation and make it much worse. Given that AI may soon be able to perform their job, it is difficult to understand why a company would hire someone who is graduating from college this summer. They will either be stuck with them for years or be forced to pay a hefty amount if they decide to fire them. Anyone under the age of thirty should be exempt from that, according to the government. It ought to go farther. Portugal recently provided a 100% tax exemption for the first year of employment and a 75% exemption for the second year for those under 35. That plan would be easy for the UK and many other nations to imitate. Otherwise, it might reverse the significant increase imposed in the previous Budget by lowering the national insurance premiums for "first rung" graduate jobs.

There is no denying that Gen Z is facing a slaughterhouse of AI jobs. Computer programs that are extremely intelligent and easier to manage are replacing the entry-level labor that was the foundation of careers. The only way to combat that is to generate a large number of new jobs to replace the ones that machines are replacing, and only a drastic deregulation will accomplish that.