Many recent grads say AI is making it harder to get a job. Economists aren’t so sure

Many recent grads say AI is making it harder to get a job. Economists aren't so sure

The unemployment rate for 22- to 27-year-olds with higher education degrees is above the national average. Is artificial intelligence to blame?

Recent college graduates are struggling to land entry-level jobs. According to the Federal Reserve Bank of New York, the unemployment rate for young adults with new degrees is higher than the rate for all workers, and a lot of young people blame artificial intelligence. So reporter Lee Gaines decided to fact-checking their concerns.

LEE GAINES, BYLINE: Irene Chang studied engineering at Georgia Tech because she likes solving problems. She also wanted to major in something she knew could lead to a stable career. But so far, that's been a challenge. Chang graduated in May, but she started applying to entry-level jobs nearly a year ago, while she was still in school.

IRENE CHANG: I think I've applied to around 450 applications now.

GAINES: Chang suspects that AI is part of the reason she's struggling to reach the first rung in her career ladder.

I CHANG: I feel like the entry-level skills that you have - they're important, but also something that AI can do very, like, efficiently.

GAINES: Things like analyzing data and coding. And Chang isn't alone. Nearly half of recent graduates surveyed this spring by ZipRecruiter said AI had already affected hiring in their field. But the evidence is mixed, and economists don't all agree. On the one hand, Stanford University economist Erik Brynjolfsson says AI is hurting young workers' job prospects.

ERIK BRYNJOLFSSON: I would say that AI is not the whole story, but it's part of the story, and the evidence is building.

GAINES: Brynjolfsson has studied some of the jobs that are more likely to use AI - think software developers and marketing managers. He found employment of early-career workers in those fields has declined significantly since late 2022, when AI tools like ChatGPT started popping up. Meanwhile, employment trends for more experienced workers in those same fields have remained stable. Brynjolfsson thinks AI may be impacting young workers more because...

BRYNJOLFSSON: These technologies are disproportionately able to capture book learning and codified knowledge, and that has a lot of overlap with entry-level people.

GAINES: Harvard University economist David Deming isn't convinced AI is to blame for the early-career job market.

DAVID DEMING: If you look very carefully at the timing, it looks like the decline in junior hiring actually started, like, six months before ChatGPT was released. What that tells me is it's something else. I think it's more like remote work.

GAINES: Deming says employers might not want to hire entry-level workers for jobs that went remote after the pandemic because it's harder to train them from afar.

DEMING: The value proposition of hiring a junior person when you know they're going to be at home is just not as great. And conversely, the value proposition of hiring a more senior person is greater. Because of remote work, you have access to a broader pool of talent from around the country.

GAINES: If AI was replacing entry-level jobs, you'd expect to see companies that rely heavily on AI to hire fewer workers. But University of Chicago economist Anders Humlum says data shows that that's not the case.

ANDERS HUMLUM: If we look at the heavy users of these tools - the firms that are paying a lot of money to Anthropic and OpenAI to subscribe to their models - they're hiring more than anyone else.

GAINES: While they disagree on how much AI is impacting the job market right now, all three economists do agree there's a major employment shift underway. Here's Deming at Harvard.

DEMING: I think jobs that used to be safe will become unsafe and jobs that used to be unsafe will become safe. There'll be a lot of shuffling around. But I think on net, it'll be a force for good. But it'll take some time, and it's going to be very bumpy and messy, and buckle up.

GAINES: His advice for Irene Chang and other recent grads who are still looking for a job...

GAINES: I shared what I learned with Chang. She says it's helpful to hear what economists have to say.

I CHANG: It does make me feel a little bit validated. Yeah, I'm definitely holding on to that right now.

GAINES: For NPR News, I'm Lee Gaines.

(SOUNDBITE OF LADY, THE BAND SONG, "HOLD ON")

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