US Labor Market Stagnates as AI Slows Entry-Level Hiring

Goldman Sachs chief executive David Solomon indicated this week that the bank expects its intake of recent graduates and interns to ease slightly in coming years as artificial intelligence alters the composition of entry level work. Speaking on Bloomberg's Odd Lots podcast, Solomon described the adjustment as nuanced rather than dramatic and stressed that the firm plans to continue hiring thousands of young workers annually. This year alone the bank is set to bring aboard roughly 2,400 to 2,500 interns along with a comparable number of permanent hires starting in July, figures that align closely with pre-pandemic norms.

Solomon noted that the firm has already tilted its hiring mix toward engineering talent over the past decade and that further subtle changes are likely given the capabilities of current tools. He rejected suggestions of a sharp contraction, saying the bank would still recruit heavily from schools even as productivity gains from technology reduce the need for some routine tasks. Such shifts reflect standard market responses to improvements in capital equipment, where higher output per worker allows organizations to reallocate labor toward higher value activities.

The pattern at Goldman coincides with a wider labor market in which hiring and separations have both remained subdued. Government data show average monthly job gains last year fell to just 9,700, the slowest pace in years, while the share of unemployed workers out of a job for more than six months has climbed above 25 percent. Quits have dropped to their lowest level since the depths of the pandemic, consistent with workers holding positions they already possess rather than testing new opportunities.

These developments point to ordinary adjustments in response to technological change and uncertainty over future costs. Young people entering the workforce face the familiar requirement to demonstrate skills that complement new tools, a process that has repeated across earlier waves of automation and computing advances. Claims that external factors such as tax policy or geopolitical events alone explain the slowdown overlook the role of individual preparation and the incentive effects of higher productivity on hiring thresholds.

Solomon's comments underscore that banks and other employers continue to value fresh talent even while trimming roles that AI can handle more efficiently. The result is not a hiring collapse but a rebalancing toward workers who can leverage the new technology. Historical evidence from prior industrial and digital transitions shows that such rebalancing ultimately expands opportunities for those who acquire relevant capabilities rather than preserving older job structures.