The AI Job Squeeze: Why Entry-Level Tech Roles Are Vanishing for Young Professionals

A new state comptroller’s report reveals a troubling reality for young adults in New York: despite being more educated than previous generations, they face unprecedented financial pressures from shrinking job markets, soaring housing costs, and mounting debt.

More Educated, But Not More Secure

Young adults in New York are significantly more educated than their predecessors, with nearly half of residents ages 26 to 34 holding a bachelor’s degree or higher. However, this educational achievement hasn't translated into economic stability. Unemployment among young adults stood at 8.6% in 2023, more than double the rate for those 35 and older. For those ages 18 to 25, unemployment climbed to 12.1%.

The disparity is even more pronounced across racial lines, with Black and Hispanic young adults experiencing unemployment rates more than twice those of their white peers.

Entry-Level Jobs Are Shrinking

The job market has fundamentally shifted beneath young workers' feet. Service and administrative roles—where young adults traditionally found entry-level opportunities—are projected to shrink in coming years. The report identifies artificial intelligence as a key factor accelerating the decline in entry-level opportunities, particularly in tech and office support jobs.

Nationally, entry-level tech jobs fell by 36% between 2020 and 2025. Employers are increasingly favoring experienced workers when integrating AI, making it harder for new graduates and career changers to establish a foothold in the industry.

Housing Costs Delay Independence

Housing has emerged as one of the biggest barriers to financial independence for young adults. In 2023, nearly one in four New Yorkers ages 26 to 34 lived with their parents. Among those who rented, more than 35% spent over 30% of their income on rent and utilities, crossing into "cost-burdened" territory.

Homeownership is increasingly out of reach, with home prices in New York jumping more than 50% since 2019. Just 15.1% of young adults owned a home in 2023, well below the national average.

Debt Loads Keep Growing

Young New Yorkers carry some of the highest student loan balances in the country, averaging just over $30,300 per borrower. Credit card debt among young people has more than doubled nationally since 2013, reflecting growing pressure from everyday expenses.

Core costs like housing, food, and transportation have risen faster than incomes. Between 2018 and 2023, spending on these essentials increased by nearly 40%, far outpacing income growth.

Disconnected Youth Still a Concern

While the number has declined over the past decade, the report estimates nearly 200,000 New Yorkers ages 18 to 25 were "disconnected" in 2023, meaning they were neither working nor enrolled in school. Barriers such as childcare, transportation, and access to training continue to play a significant role, particularly in rural and lower-income communities.

Warning Signs for the State's Future

State Comptroller Thomas DiNapoli warned that these trends could have long-term consequences for New York's workforce and economy. The report calls for policies focused on affordability, housing supply, access to quality jobs, and workforce training to help young adults achieve financial stability and upward mobility.

Without intervention, many young New Yorkers may struggle to match the economic security of earlier generations, creating ripple effects throughout the state's economy and social fabric.