TLDR: A recent Stanford University study reveals that artificial intelligence is significantly affecting the job prospects of entry-level workers, particularly those aged 22-25 in AI-exposed fields like software development and customer service, with a reported 13-16% relative decline in employment since late 2022.
A groundbreaking study released by Stanford University’s Digital Economy Lab on August 26, 2025, indicates that artificial intelligence is having a pronounced and disproportionate impact on the job market for entry-level professionals. The research, co-authored by economists Erik Brynjolfsson, Bharat Chandar, and Ruyu Chen, analyzed extensive employment data from ADP, the largest payroll software provider in the United States, covering millions of workers across tens of thousands of firms. It also incorporated insights from the Anthropic Economic Index, which tracks how professionals utilize AI tools like Claude in their daily tasks.
The study’s most striking finding is a 13% to 16% relative decline in employment for early-career workers (aged 22-25) in occupations most exposed to AI automation since late 2022, coinciding with the mainstream emergence of generative AI tools like OpenAI’s ChatGPT. These ‘canaries in the coal mine,’ as the report’s authors describe them, are primarily in fields such as software engineering, marketing, customer service, operations management, accounting, auditing, general management, reception, and information clerical roles.
Conversely, the report highlights that workers in more hands-on professions, including health aides, maintenance workers, and taxi drivers, have seen their employment rates remain stable or even grow. This divergence suggests that the impact of AI is not uniform across the labor market.
Co-author Erik Brynjolfsson noted the ‘striking’ difference in effects across various job categories. While refraining from definitively stating that AI is causing unemployment, Brynjolfsson and his team ruled out other potential factors like COVID-19-induced remote work or changes in education. Co-author Bharat Chandar stated, ‘Our findings are consistent with the hypothesis that AI is having this effect [on the labor market], especially for entry-level workers.’
The study also sheds light on the resilience of older workers in high AI-exposure fields. For those aged 30 and over, employment in these categories actually grew by 6-12% from late 2022 to May 2025. Researchers suggest this could be due to older workers possessing ‘tacit knowledge’ that AI struggles to replicate, or greater power within organizational structures making them harder to displace.
A critical factor identified in the study is how AI is deployed. Employment declines are concentrated in roles where AI automates tasks, rather than augmenting human work. In fact, occupations where AI is used to enhance worker capabilities have seen stable or even growing entry-level employment. This distinction is crucial for navigating the future of work, with Brynjolfsson suggesting that shrewd AI deployment could lead to positive economic outcomes.
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The rapid advancement of AI capabilities underscores these findings. For instance, AI systems’ ability to solve coding problems on a widely used benchmark jumped from 4.4% in 2023 to 71.7% in 2024, a ‘staggering rate of improvement.’ This rapid evolution necessitates a strategic approach to AI integration in the workforce to mitigate negative impacts on early-career job seekers.
