AI cuts entry-level hiring as 42% of UK firms cite adoption

At London advertising agency Catalyst, a single junior employee now runs five client accounts that previously required several staff, founder Tobias Green told Cnbc. Artificial intelligence handles the research, produces a first pass of copy and gathers the data, leaving the human to check and correct the output before it reaches the client. Green described the setup as a reverse Mechanical Turk: the software works behind the scenes while the person is the face the client sees.

That shift is reshaping how Catalyst views entry-level hiring. Green told Cnbc that if AI takes away the basic work, junior staff no longer need to learn those skills, and should instead learn how to operate and direct AI tools.

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Key facts

• Open University’s 2026 Business Barometer surveyed 1,500 UK business leaders and found 51% said AI was changing how they hire.
• 19% of respondents had reduced entry-level recruitment, and 42% of those cited AI adoption as a reason.
• In a Klarus survey of 500 UK and Irish mid-market leaders, 45% said AI was helping junior employees work better and faster, and almost a quarter said it was creating new roles.
• Lucy Beaumont, global SVP of product at SHL, said some major graduate recruiters are hiring fewer people while they assess whether the roles are still needed.
• Sheila Flavell, COO of business and technology consultancy at FDM Group, pointed to tools including Claude Code and Codex as reasons developers now oversee work done by AI agents and people.

The pyramid becomes a diamond

Beaumont said organisations that were once shaped like a pyramid, with many staff at the bottom, increasingly look like a diamond, with more people concentrated at mid-level. She called that a short-term fix that can turn into a crisis when employers plan for the future, because entry-level roles are where people make mistakes and pick up the habits of working in a corporate environment.

Hiring itself is changing shape. Beaumont said some employers have moved away from recruiting graduates into predefined jobs and now hire for broad capabilities, deciding later where to deploy them. One large global retail bank she works with recruits beyond traditional talent pools, taking graduates in subjects such as psychology and law on the reasoning that technical skills can be taught while critical thinking is harder to build from scratch.

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Oversight arrives earlier

Software development shows the pattern most clearly. Flavell said developers increasingly supervise projects completed by AI agents alongside colleagues, which pushes junior workers toward oversight responsibilities much earlier in their careers and makes the ability to work with other people central. FDM Group now trains people on real business problems, asking them to solve these through agentic engineering rather than simply learning how the tools work.

Cheney Hamilton, a director at research firm Bloor, frames the open question differently: whether juniors can develop the judgement to supervise work they have never done themselves. She argues that basic tasks were the route by which people accumulated context, and that AI lifts the floor of what a junior can produce without supplying the judgement to know when the output is wrong. Her alternative is to treat entry-level work as exposure rather than output, with juniors correcting AI-generated work while senior colleagues deliberately teach them the judgement around it.

Why it matters

The junior rung is where most industries convert graduates into experienced staff, so cutting it changes the supply of mid-level workers several years out. The data suggests a split outcome rather than a simple decline: a minority of UK employers are recruiting fewer juniors because of AI, while a larger group is using the same technology to make junior work faster. What changes for graduates is the entry requirement, which shifts from performing tasks to directing and checking the systems that perform them.

What to watch

Watch whether the share of UK employers cutting entry-level roles keeps climbing in the next Business Barometer, and whether employers that have paused graduate intakes restart them once they can define what the roles should do. The training experiments now running at firms such as FDM Group will show whether judgement can be taught deliberately rather than absorbed on the job.

Written by

Benjamin

Benjamin Carter covers business, finance, and the stock market for StockPil, focusing on the trends and data that matter to everyday investors.

Source: CNBC