The First Canary Has Fallen: How AI is Quietly Reshaping Entry-Level Jobs
Every technological revolution begins with whispers before the thunder.
The steam engine pushed weavers aside. The spreadsheet made armies of clerks redundant. Now, generative AI is doing something similar, but the story unfolding is subtler and more targeted. According to a new Stanford-backed study, the first real casualties of AI’s rise are not middle managers or senior executives, but they are 22- to 25-year-olds trying to land their first serious job.
The researchers call it the “canary in the coal mine” effect. Using payroll data from millions of American workers, they tracked how employment has shifted since ChatGPT and its cousins went mainstream in late 2022. The headline finding is stark: young professionals in AI-exposed jobs like software engineering and customer service have seen employment fall by about 13 percent compared to their older peers. It’s an early warning signal.
What makes this different from past cycles of disruption is where the knife cuts. AI does not easily replace “tacit knowledge” - the kind of judgment, intuition, and hard-won skills that only come from years in the trenches. What it does replace, with ruthless efficiency, is codified knowledge: the textbook stuff, the kind you pick up in school or in the first year of a job. Unfortunately, codified knowledge is exactly what fresh graduates bring to the table.
The study lays out six sharp insights:
1. Young workers are losing ground in AI-heavy roles while older peers in the same jobs are stable or even thriving.
2. Overall employment is still growing. The economy is not collapsing, but growth for entry-level workers has stalled.
3. Automation is the culprit. Jobs where AI substitutes for humans show declines. Jobs where AI augments humans do not.
4. The trend holds even after controlling for firm-level shocks, so this is not just about tech layoffs or interest rate hikes.
5. Wages are sticky. Paychecks haven’t fallen much, but the opportunities have.
6. The patterns repeat across industries, remote and non-remote roles, and educational backgrounds. This is systemic.
For investors and builders, this is a flashing signal. Labor markets are shifting at a granular level, and that creates both risks and opportunities. Risk, because a generation of young professionals may struggle to find their footing. Opportunity, because any venture that can retool how young talent gains “tacit knowledge” faster, through apprenticeships, AI-human hybrid workflows, or new models of skill formation could become indispensable.
History tells us that these adjustments eventually stabilize. The IT revolution of the 90s first caused dislocations but later gave rise to an entire ecosystem of new jobs and companies. AI will likely follow the same curve, but the near-term pain will be real. The canary has already stopped singing, and those who pay attention now will be positioned to build the next set of platforms, products, and institutions that guide workers through this transition.
For me, as an entrepreneur in the intersection of technology and capital, this is more than a story about jobs. It’s a glimpse into where value will flow next. Markets reward those who see the shift early, not when it’s obvious. And if you’re reading this, the time to build around AI’s impact on the workforce is now.