AI Causes 13% Entry-Level Employment Drop in US, Stanford Study Finds

A comprehensive study from Stanford University reveals that the rise of AI, particularly generative AI tools, has caused a significant 13-16% decline in employment for early-career workers aged 22 to 25 in AI-exposed fields like software engineering and customer service. The research, based on vast payroll data from ADP, highlights that this employment drop is concentrated among entry-level workers performing routine, codifiable tasks that AI can automate, whereas older workers with more experience have seen stable or growing employment. The study emphasizes that AI's impact differs depending on its application: jobs where AI augments human work tend to maintain or increase employment, while roles where AI automates tasks face declines. Researchers ruled out other factors such as the COVID-19 pandemic or shifts in education as primary causes, pointing to AI as the main disruptive force. The findings raise concerns about the future job prospects for young workers and suggest a need for companies to integrate AI in ways that support rather than replace employees. This research is noted as the largest, most real-time analysis of AI’s labor market effects to date, serving as an early warning for potential widespread disruption in the workforce.