Artificial intelligence is fundamentally changing the job market, and young workers are bearing the heaviest burden. A groundbreaking study from Stanford University has revealed that AI is already having a major impact on employment for people just starting their careers.

The research, led by economist Erik Brynjolfsson, used payroll data from millions of American workers to track how AI affects different age groups. The findings are striking: workers aged 22 to 25 in AI-exposed jobs have seen employment drop by 13% since late 2022, when ChatGPT and similar tools became widely available.

Software engineering and customer service are hit the hardest. Young software developers experienced a devastating 20% drop in employment by July 2025 compared to their peak in late 2022. Customer service representatives in the same age group faced similar massive job losses. These are jobs that many college graduates traditionally used to start their careers.

What makes this situation especially concerning is that older workers in the exact same jobs are thriving. Workers over 30 in AI-exposed occupations saw their employment grow by 6% to 9% during the same period when young workers were losing jobs. This creates an unprecedented gap where technology helps experienced workers while pushing out newcomers.

The reason comes down to different types of knowledge. AI systems like ChatGPT are trained on books, articles, and written material found online - essentially the same "book learning" that college students acquire. Young workers entering the job market often rely heavily on this theoretical knowledge. But experienced workers have something AI cannot easily replicate: tacit knowledge, real-world experience, and "tricks of the trade" that are never written down.

Real companies are making these changes right now. Swedish furniture giant Ikea announced it will phase out traditional call center roles and replace them with an AI chatbot nicknamed "Billie". While Ikea is offering retraining programs for affected workers to become interior design advisors, not all companies are being so considerate.

Indian e-commerce startup Dukaan took a much harsher approach. The company fired 90% of its customer support team in mid-2023 and replaced them with an in-house chatbot. CEO Suumit Shah openly celebrated the move, boasting that it cut customer service costs by 85% and improved response times. For the fired workers, it meant sudden unemployment with no alternative offered.

Even government jobs are not safe. The United States created a Department of Government Efficiency (DOGE) in 2025, reportedly led by Elon Musk, that uses AI to identify inefficiencies in government. This initiative alone resulted in 292,000 federal positions being eliminated in 2025. While these cuts include broader budget reductions beyond just AI, they show that even public sector jobs are vulnerable.

The speed of change is unprecedented. Brynjolfsson noted that this is "the fastest, broadest change" he has seen in the job market, with only the shift to remote work during COVID-19 being comparable. Job listings for entry-level office positions have fallen by 15% in one year, while job postings mentioning AI skills have increased by 400% over two years.

The situation creates a dangerous cycle. If young people cannot get entry-level jobs to gain experience, industries will struggle to develop the next generation of experienced workers. As Brynjolfsson explains, "We're going to have to think about how the labor market adjusts so that everyone gets a chance to be working their way up the career ladder."

Not all AI use leads to job losses. The research shows that companies using AI to augment human workers rather than replace them are actually hiring more people. In fields like nursing, AI is expected to help workers by taking over routine tasks, allowing healthcare workers to spend more time with patients.

Workers who learn to use AI as a tool are finding success. About 23% of employees were using generative AI in their jobs at least once per week by late 2024. Those who can work with AI rather than compete against it are better positioned for career success.

Some young workers are responding by avoiding AI-exposed careers entirely. Career website Zety reported a trend called the "AIxiety Pivot" - young professionals proactively switching to blue-collar work because of AI-related fears. However, only about one-third of Generation Z workers believe skilled trades offer a stable career path, compared to half of older generations.