It feels like I'm competing with AI to just try to get my foot in the door.
A generation of young Americans trained for the digital economy now finds itself standing at a door that automation has quietly closed. Across the country, recent computer science graduates face a labor market reshaped not by recession but by structural transformation — one in which artificial intelligence absorbs the entry-level work they were educated to perform. The Federal Reserve's rate cuts, designed to warm a frozen hiring climate, cannot reach the deeper cold: companies are not merely hesitant to spend, they are reconsidering whether certain human roles need to exist at all.
- Entry-level tech job postings have fallen 35% since 2020, with developer and designer roles hit hardest even as AI and data center positions surge — a split that reveals not a slowdown but a reordering.
- Trade policy chaos under the Trump administration has paralyzed corporate hiring decisions, with CEOs shifting from neutral to pessimistic and 68% planning to hold or shrink their workforces.
- The Fed's rate cuts assume companies want to hire but can't afford to — yet the real barrier is structural uncertainty and automation, tools that cheaper borrowing cannot address.
- Fed Governor Christopher Waller openly acknowledged that AI-driven layoffs and hiring reductions will accelerate, urging policymakers to 'let the disruption occur' — a posture that offers little to those already displaced.
- Hundreds of thousands of new graduates, like Abraham Rubio of Montclair State, describe competing against AI for entry-level footholds in an industry that trained them but may no longer need them.
Hundreds of thousands of young Americans graduated this year with computer science degrees and stepped into a job market that had moved on without them. The Federal Reserve has been cutting interest rates, with more reductions expected, hoping to nudge companies back toward hiring. But for entry-level tech workers, that lever may be pulling at nothing.
Technology companies have largely stopped expanding their workforces, caught between the uncertainty of Trump's shifting trade policies and a deeper reckoning with what they actually need from human employees. A survey of 130 CEOs released in mid-October by the Conference Board found that business leaders' six-month economic outlook had turned pessimistic, with 68% planning to maintain or shrink headcount. As economist Laura Ullrich of Indeed observed, the labor market is frozen not by cost but by indecision — and lower interest rates cannot thaw that.
Beneath the policy paralysis lies a more permanent disruption. AI is absorbing the work that entry-level tech roles once required. A Google study found 90% of tech workers already use AI on the job. Indeed data showed tech and mathematics job postings down 35% compared to early 2020, with developer and designer positions falling most sharply while AI and data center roles climbed. Fed Governor Christopher Waller acknowledged in October that AI-driven hiring reductions will intensify, particularly for college-educated workers, and advised policymakers to allow the disruption to unfold and trust in long-run gains.
The human cost of that patience is concentrated among the young. Economists at Nomura and Oxford Economics both describe the same mismatch: a large cohort of new graduates, and insufficient demand for what they were trained to do. The Conference Board's CEO survey found most business leaders expect AI to transform more than half of all roles within five years. For graduates like Abraham Rubio, who studied computer science and game programming in New Jersey, the feeling is one of competing against the very technology his field created — and wondering whether the door will ever fully open.
Hundreds of thousands of young Americans graduated from college with computer science degrees over the past year and walked into a job market that wasn't waiting for them. The Federal Reserve has begun cutting interest rates, with more cuts expected in the coming weeks, a move designed to encourage companies to hire. But for entry-level tech workers, cheaper borrowing costs may do almost nothing to solve the problem they face.
The technology industry, like most sectors, has largely stopped hiring. Companies are hesitant to expand their workforce without clarity on what comes next—particularly given the economic uncertainty swirling around President Donald Trump's trade policies. The Fed's rate cuts work by making it cheaper for businesses to borrow money and expand. But that mechanism only works if companies actually want to hire. Right now, they're frozen, waiting to see what tariffs will look like, what trade deals will hold, and what the broader economic landscape will be. On Thursday alone, Trump called off trade talks with Canada after Ontario ran an anti-tariff advertisement. Meanwhile, his administration is investigating whether China complied with a 2019 trade agreement, with a major discussion with Chinese leadership expected during an upcoming meeting in South Korea. In this fog, hiring plans stay on the shelf.
A survey of 130 CEOs released on October 16 by the Conference Board revealed something stark: their outlook for the economy over the next six months shifted from neutral to pessimistic. Sixty-eight percent said they plan to maintain or shrink their workforce. Laura Ullrich, an economist at Indeed, put it plainly: "The labor market has been frozen up because people are just having a hard time making decisions." Lower interest rates cannot thaw that kind of paralysis.
But there's a deeper problem that rate cuts cannot touch. Artificial intelligence is beginning to do work that entry-level tech workers used to do. A Google study from September found that 90 percent of tech workers are already using AI at work. Job postings in technology and mathematics fields on Indeed were down 35 percent in early October compared to February 2020. Certain roles—developers and designers—saw the steepest drops. Meanwhile, postings for AI and data center positions surged. This is not a cyclical downturn. This is a structural shift in what the industry needs.
Fed Governor Christopher Waller acknowledged this reality in October. "Layoffs and reductions in hiring plans due to AI use are expected to increase, especially for workers with a college degree," he said at an event in Arlington, Virginia. His response was to urge patience: "For policymakers, we must let the disruption occur and trust that the long-run benefits will exceed any short-run costs." That's cold comfort for someone who spent four years studying computer science.
The mismatch is stark. There are many new computer science graduates looking for work. There is not enough demand for entry-level positions. David Seif, chief economist for developed markets at Nomura, described it plainly: "You have a lot of people who are new graduates from college, but there doesn't seem to be enough demand for these entry-level workers." Matthew Martin, a senior economist at Oxford Economics, framed it as a structural problem: "Computer and mathematical science occupations are disproportionately exposed to automation and displacement."
The Conference Board's CEO survey showed that most business leaders expect AI to fundamentally transform more than half of all job roles in their organizations within five years. Abraham Rubio, who graduated from Bloomfield College of Montclair State University in New Jersey this year with a degree in computer science and game programming, captured the feeling: "It feels like I'm competing with AI to just try to get my foot in the door." He is not alone. Hundreds of thousands of his peers are in the same position, waiting for a labor market that may never need them in the way they were promised.
Notable Quotes
The labor market has been frozen up because people are just having a hard time making decisions. So long as economic uncertainty is high, it's hard to know how many people you should hire.— Laura Ullrich, economist at Indeed
You have a lot of people who are new graduates from college, but there doesn't seem to be enough demand for these entry-level workers.— David Seif, chief economist for developed markets at Nomura
The Hearth Conversation Another angle on the story
So the Fed is cutting rates to help the labor market, but you're saying that won't actually help these young tech workers?
Right. Rate cuts work by making it cheaper for companies to borrow and expand. But companies won't expand if they don't know what their costs will be. Trump's trade policies are still in flux—tariffs keep shifting, deals keep falling apart. CEOs are paralyzed.
But couldn't lower rates eventually push companies to take risks and hire anyway?
In theory, maybe. But there's something bigger happening. AI is automating the work these graduates were trained to do. Job postings for developers and designers are down 35 percent since 2020, while AI and data center roles are surging. It's not that companies can't afford to hire—it's that they don't need entry-level workers the way they used to.
So this is permanent? These graduates are just out of luck?
It's a structural shift, not a temporary downturn. The Fed can't fix that with monetary policy. You can't cut your way out of a problem where the job itself is disappearing.
What do the CEOs think will happen?
Most expect AI to transform over half their job roles in the next five years. They're not optimistic about hiring. Sixty-eight percent said they plan to maintain or shrink their workforce.
And the young people caught in this?
They're competing with AI just to get their foot in the door. Hundreds of thousands of them. The Fed's rate cuts won't change that equation.