At first glance, the tech scene in New York City appears to be thriving: OpenAI and Anthropic have been putting down roots in the city, while stalwarts of the tech industry like Google now have over 14,000 employees based in New York. Between 2008 and 2023, tech employment in the city has increased by 160%, only outdone by the explosive growth of the tech industry in San Francisco.
But overall job growth in the city’s tech industry has stagnated in recent years, and there is one area in particular where tech employment has taken a sharp dip: Entry-level tech jobs in New York have taken a significant hit in the years since ChatGPT’s public release ushered in the AI boom.
A new report from the Center for an Urban Future (CUF), a New York-based think tank, found that as of 2022, the number of entry-level job postings in the tech industry has dropped by 49%—a bigger decline than in any other sector, even as generative AI has seemingly derailed entry-level hiring across sectors. There continues to be a steady supply of college graduates with computer science degrees, but there aren’t nearly enough entry-level positions for them to fill.
“The core issue is that employers face an individual incentive to hire workers who already have two or three years of experience,” Eli Dvorkin, editorial and policy director at CUF and one of the authors of the report, said in a recent interview with Searchlight. “But if every employer acts that way, the broader entry-level ecosystem collapses, which ultimately harms employers as well.”
The analysis found that on the whole, the jobs that have seen a marked dip in hiring are those that are most exposed to generative AI. Since 2022, entry-level job postings in roles with high AI exposure have decreased by 29% across New York City.
The outlook is not quite as grim across other jobs: Entry-level hiring has remained robust—growing by 21%—in jobs that are not especially exposed to AI, according to the CUF report. Even within tech, employers have continued hiring for roles that require expertise in security and data analysis. Entry-level workers with strong AI skills are in particularly high demand, and job postings have actually climbed by 20% in the last four years.
Still, the overall decline in hiring for entry-level tech jobs does echo a broader shift in New York: Since 2022, most industries have seen a steady drop in job postings for entry-level roles.
This hiring slump is representative of a broader phenomenon playing out across the country, particularly in sectors like tech and finance. Some economists have been wary about overstating the impact of generative AI on the labor force—and even high-profile AI leaders have walked back their bold claims about AI ushering in widespread job losses.
But there are clear signs that entry-level workers are bearing the brunt of the toll: Stanford University’s Institute for Human-Centered Artificial Intelligence recently found that the employment gap for young workers (defined as workers ages 22 to 25) has widened in the last year to 19%, when compared against similarly situated workers in roles that are less exposed to AI.
In a recent survey by the Pew Research Center, young workers were more skeptical of AI than they had been previously, a sign that they are increasingly concerned about how it might upend the labor market. Nearly three-quarters of adults under 30 said they believed AI will reduce the number of jobs within the next two decades.
The reports of looming job losses often focus on how generative AI is impacting white-collar workers, but research from the Brookings Institution earlier this year indicates that it’s not just highly skilled workers who are being shut out of the workforce. AI adoption is also disrupting the pathways available to workers without college degrees who have traditionally been able to move into white-collar work.
In cities like New York, the growth in tech employment has also helped many workers from low-income backgrounds move into more lucrative jobs—but the changes ushered in by AI may make it more difficult for those types of workers to find their footing. But those pathways could disappear altogether if the city doesn’t reinvest in its tech workforce and help New Yorkers get the experience they need to land the entry-level jobs that are in high demand.
As Dvorkin put it recently: “If anything, our tech sector has proven remarkably resilient given all these macroeconomic changes and technology shifts, and it remains well-positioned for future growth. However, the real challenge is who gets the opportunity to enter that sector in the first place.”