Entry-level hiring has now collapsed, and the ruthless advance of artificial intelligence (AI) is at least partly to blame, a new report says.
According to SignalFire, a venture capital firm based in San Francisco, the hiring of new graduates at big tech companies such as Google, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla has declined by more than 50% since 2022.
The report, titled “State of Tech Talent: 2025,” plainly states that the reason for the collapse is closely related to the rise of AI. The latter, though, is part of a broader shift underway in the industry.
“The door to tech once swung wide open for new grads. Today, it’s barely cracked. The industry's obsession with hiring bright-eyed grads right out of college is colliding with new realities: smaller funding rounds, shrinking teams, fewer new grad programs, and the rise of AI,” says the report.
The data is damning. Hiring for mid- and senior-level positions bounced back in 2024, but new graduates make up just 7% of hires by big tech firms, down from 25% in 2023. SignalFire found that even at startups, only 6% of employees are college grads.
“As AI tools take over more routine, entry-level tasks, companies are prioritizing roles that deliver high-leverage technical output,” points out the report.
“Big tech is doubling down on machine learning and data engineering, while non-technical functions like recruiting, product, and sales keep shrinking, making it especially tough for Gen Z and early-career talent to break in.”
LinkedIn’s chief economic opportunity officer, Aneesh Raman, agrees. In an op-ed written for The New York Times, he wrote that AI may pose a significant threat to millions of students who will be graduating this year.
Raman even likened today's situation to that of the decline of the manufacturing sector in the 1980s, which saw a steep fall. “Breaking first is the bottom rung of the career ladder,” he said.
Indeed, in one of LinkedIn's recent surveys, over 3,000 executives at the vice president level or higher agreed that AI will eventually replace some of the mundane tasks that are typically done by entry-level workers.
It’s not just AI, though – SignalFire’s report also points to a perception gap. Fifty-five percent of employers agree with a statement that Gen Z workers struggle with teamwork, and 37% said they would choose AI over a Gen Z hire.
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