As artificial intelligence transforms the landscape of entry-level employment, corporate executives are increasingly eliminating traditional training positions. This shift is leaving recent graduates grappling for roles in a contracting job market, while companies that forego talent development may face significant long-term shortages at senior levels.
According to the CFA Institute, decades of established corporate apprenticeship models are being dismantled. Junior analysts, who previously spent years honing foundational skills, are now expected to navigate machine-generated risk assessments and make critical decisions from the outset. Peter Watkins, senior director of university programmes at the CFA Institute, expressed concern over the current expectations for new entrants to the workforce. “When you were an apprentice doing something 20 years ago, you needed about two or three years of work alongside other people,” he stated. “It’s almost like we’ve forgotten that period is needed for someone to be really effective in the next stage in their career.”
The Impact of Automation on Workforce Development
Financial institutions are increasingly adopting automation to cut costs and appease shareholders. A report by NVIDIA highlights that 73 percent of leaders in the financial sector regard AI as essential for success, and 89 percent acknowledge that the technology has boosted revenue. Yet, management consultants caution that slashing talent development initiatives may prove detrimental in the long run. Erik Stettler, chief economist at Toptal, remarked, “It may look better on paper or in the Excel sheet to cut your entry-level hiring and talent development in this transitional moment, but this is a transitional moment. You have a responsibility to foster tomorrow’s talent for your organisation. AI is not an excuse to hold off on that. You need to be playing the long game.”
While advancements in AI are a significant factor in the decline of entry-level positions, they are not the sole cause. A survey conducted by Cengage Group found that 46 percent of employers attribute reduced hiring to AI and emerging technologies, while nearly half cite broader economic uncertainty and a tight labour market as contributing factors. Watkins noted, “Firms possibly are not recruiting as many as they have some years ago, but that’s as much about economics as AI.”
Challenges for New Graduates
Recent graduates now encounter unprecedented challenges when starting their careers. The Cengage Group survey revealed that 76 percent of employers plan to hire fewer or the same number of entry-level positions in 2025. Furthermore, a study from the Federal Reserve Bank of New York found that 42 percent of recent graduates are currently underemployed. This trend raises concerns about the future workforce and the skills necessary for success.
Moreover, organisations that substitute junior staff with software may overlook the essential human judgement needed to effectively manage automated systems. Neil Costa, founder of the recruitment agency HireClix, cautioned against fully transferring foundational tasks to machines. “They may benefit now by saving costs on the human component of their business operations or employee expenses, but I think there’s going to be a toll to pay afterwards,” he said. This sentiment underscores the need for a balanced approach to automation.
Industry experts advocate for leveraging technological advancements to develop resilient innovators. Costa highlighted that younger generations quickly adapt to emerging technologies. “Why would you just take the short-term gain by dodging some payroll expenses now, versus the potential upside on what that could generate for the top line?” he posed.
For applicants navigating these shifts, showcasing examples of constructive software usage is becoming essential. Stettler noted that the nature of entry-level jobs has evolved, stating, “The difference between an entry-level job today and when I was starting out, is that now you will be thinking on the systems level from day one.” As companies navigate this transitional phase, fostering the next generation of talent remains crucial for sustaining growth and innovation in the evolving job market.
