Companies may be cutting the very workers AI helps most.
A Stanford Institute for Economic Policy Research policy brief by Neale Mahoney, Erika McEntarfer, and Karsen Wahal finds no economy-wide “AI jobs apocalypse.” But its early evidence creates a possible paradox: employment among less-experienced workers has declined in AI-exposed roles, even as experiments show that AI often gives them the largest productivity boost.
Recent graduates are facing the most challenging job market in years, with unemployment rates for new grads reaching 5.6 percent in early 2026, up 1.6 percentage points from three years earlier. This rise has fueled concerns that AI is replacing many of the jobs recent graduates once sought. Junior roles often involve routine research, analysis, and writing tasks that can now largely be done with AI. Consistent with this intuition is empirical evidence that AI may be dampening demand for new hires.
In a widely discussed paper, Brynjolfsson, Chandar, and Chen report a notable decline in employment among early-career workers in AI-exposed occupations, notably software developers and customer service representatives, since ChatGPT’s launch in 2022. As shown in Figure 2, by contrast, employment among older workers in those same occupations remained relatively stable or continued to grow. The authors liken these young workers to “canaries in the coal mine,” the first to experience labor market disruption from AI. Other researchers have since identified similar negative effects on the hiring of young AI-exposed workers in the U.S. and the U.K., beginning in 2022.
The authors are careful not to pin the entire decline on AI. The Federal Reserve’s rate hikes, the end of pandemic staffing surges, and weaker on-the-job learning in remote roles all muddy the timeline. But the hiring decline itself is real, and younger workers in AI-exposed jobs are taking the hit.
Design’s vanishing bottom rung looks even more precarious against this evidence. The brief does not study designers specifically or establish that AI caused the decline. But if employers are closing junior roles in anticipation of AI, that is a business decision, not a technical inevitability. And the productivity findings make that logic even stranger:
In experimental settings, generative AI tools — such as chatbots and coding tools — have often been found to disproportionately improve the performance of less experienced and poorer performing workers. In one such study, researchers analyzed the impact of a generative AI assistant on customer support agents in a large call center. The assistant increased overall productivity by 15 percent, with gains highly concentrated among novice and less-skilled workers, who saw a 30 percent improvement in the number of issues resolved per hour. There was no performance improvement among highly skilled customer service agents, whose response quality fell slightly.
Other studies also show that AI tools generally speed up task completion, though the effects vary by task, context, and skill level. Figure 3 summarizes research findings on the impact of AI tools on speed across a variety of tasks. In software development, the use of GitHub Copilot — an AI tool that suggests code and functions — allowed tasks to be completed 56 percent faster, with gains concentrated among less-experienced programmers. More modest impacts on software development were found in a separate paper, with effects ranging from 10 percent to 30 percent, depending on the firm where it was deployed.
If companies stop hiring the people who benefit most from these tools, who exactly do they expect to become tomorrow’s senior talent?
