No jobs for young workers due to AI? Here’s what Goldman Sachs data shows about unemployment trends
In the age of artificial intelligence, job markets across the globe are undergoing a massive transformation. While AI offers efficiency and innovation, it is also sparking concerns about unemployment—particularly among younger workers. A recent analysis by Goldman Sachs has shed light on this emerging challenge, revealing that Generation Z professionals, especially those in tech, are facing an uphill battle in securing employment.
A Steep Rise in Youth Unemployment
According to Goldman Sachs, the unemployment rate among young tech workers—those aged 20 to 30—has surged by nearly 3 percentage points since early 2024. This figure is staggering when compared to the overall rise in unemployment across the workforce, which remains relatively stable. In fact, the jump in youth joblessness is four times higher than the broader trend.
This disproportionate spike raises red flags. Young professionals, particularly fresh graduates and early-career workers, often rely on entry-level jobs to build experience. However, these very roles are now being automated or eliminated due to AI technologies.
Why Young Workers Are More Vulnerable
AI’s disruptive impact is most visible in the tech sector, where automation and generative AI tools have become mainstream. Entry-level tasks, such as coding, customer support, data entry, and even content creation, are increasingly handled by machines. For example, companies now deploy chatbots powered by large language models to replace junior customer service representatives.
Goldman Sachs economist Joseph Briggs explains that early-career professionals are particularly exposed. “These roles often involve repetitive, process-driven tasks—the kind AI is rapidly optimizing,” he notes. As a result, many organizations are rethinking their hiring strategies, favoring experienced or AI-savvy workers over fresh graduates.
The Post-ChatGPT Job Landscape
Interestingly, the shift began soon after OpenAI launched ChatGPT in late 2022. Since then, the share of U.S. employment in the tech sector has steadily declined, dropping below its long-term average. While innovation continues, companies are streamlining their operations by leaning heavily on automation.
The widespread adoption of AI in fields such as software development, IT support, digital marketing, and even journalism has caused an imbalance between job creation and displacement. While some jobs are being enhanced by AI, others—especially entry-level roles—are disappearing altogether.
A Broader Workforce Shift
Goldman Sachs forecasts that 6% to 7% of U.S. jobs could be displaced by AI over the next decade. While that figure may sound alarming, the overall rise in unemployment is expected to be modest—around 0.5 percentage point. Why? Because many workers are likely to reskill and transition into emerging roles that AI cannot easily replicate.
However, this transition isn’t seamless for everyone. Young workers without significant experience or technical skills may find it harder to pivot. Without targeted support through reskilling programs or apprenticeships, many may struggle to find their footing in the AI economy.
Gen Z Men Facing a “Career Cliff”
Another concerning trend is the growing gender gap in employment. According to the data, Gen Z men are experiencing higher levels of unemployment than their female counterparts. While young women are securing roles in relatively stable sectors such as healthcare, education, and hospitality, men are more concentrated in white-collar tech and legal roles—areas that are currently shrinking due to AI disruption.
This “career cliff” for young men is partly due to traditional gender roles and educational pathways. Men have historically dominated tech and legal professions, but now those fields are undergoing rapid automation. Meanwhile, women—though still underrepresented in some tech roles—are finding opportunities in people-centric industries less vulnerable to AI.
Is AI Really to Blame?
It’s easy to blame AI for the challenges young workers face, but the reality is more nuanced. AI is a tool—and like all tools, its impact depends on how it’s used. Organizations that use AI to augment human capabilities rather than replace them may still offer opportunities for early-career professionals to learn and grow. However, businesses focused purely on cost-cutting may favor automation at the expense of workforce development.
Moreover, it’s worth considering other economic factors at play. The post-pandemic recovery, shifts in remote work dynamics, and global economic uncertainties are all influencing hiring patterns. But there’s no denying that AI is playing a significant role in reshaping the labor market.
What Can Be Done?
To address the growing unemployment among young workers, especially in tech, a multi-pronged approach is needed:
- Investment in Reskilling: Governments, educational institutions, and private companies must invest in upskilling programs to help young professionals adapt to the AI era. Learning how to work with AI, rather than against it, is key.
- Rethinking Entry-Level Roles: Companies should not eliminate junior positions entirely. Instead, they can reimagine them to include human-AI collaboration, mentorship, and creativity—skills that machines cannot replicate.
- Policy Support: Public policies that support workforce development, such as tax incentives for hiring young workers or funding for apprenticeships, can help close the opportunity gap.
- Promoting Gender Equity: Efforts must be made to ensure both men and women have equal access to growing industries. Encouraging male participation in healthcare and education, for example, can diversify career pathways.
Final Thoughts
The data from Goldman Sachs paints a sobering picture: AI is already affecting job prospects for young workers, particularly in the tech sector. While the technology holds immense promise, its benefits must be distributed equitably. If not addressed, the current trajectory could leave an entire generation struggling to find meaningful work at the very start of their careers.
However, with strategic planning, inclusive policies, and forward-thinking hiring practices, it is possible to turn this disruption into an opportunity—one where AI doesn’t replace young workers but empowers them.
