Julian Fayed (right) says advances in artificial intelligence have increased the productivity of his business. (ABC News: John Gunn)
Australian workers are facing a major upheaval as artificial intelligence (AI) becomes a cheaper alternative to employing humans.
While the full impact of AI is yet to be reflected in job ads or official employment statistics, both employers and employees warn the technology is already reshaping the nation's labour market.
It took recent data science graduate Tien Hung Nguyen 30 applications and an internship to land his first full-time job.
I feel privileged to have secured this position. I'm going to give everything I've got, he says.
Most of his friends are still looking for work — and he says artificial intelligence is a big reason why.
Since AI appeared, for example, a team might have needed three or four juniors and a senior. Now, it's one junior and AI, Mr Nguyen explains.
There are fewer opportunities for young graduates.
Recent graduate Tien Hung Nguyen feels lucky to have landed a job when so many of his peers are struggling to find work related to their degree. (ABC News: John Gunn)
In countries where AI is more advanced, such as the United States, lay-offs are speeding up.
Amazon is the latest big employer to warn of looming job losses. There are also reports Microsoft is shaping up to clean out more staff whose tasks can be completed by AI.
There are also worrying signs for young workers in the US, as the unemployment rate for recent college graduates nears 6 per cent.
In Australia, the unemployment rate is holding steady at 4.1 per cent. However, the jobless rate for young people — which is typically higher than the overall rate — has risen slightly to 9.2 per cent.
Economist Leonora Risse says youth unemployment is a key indicator.
Young people tend to be the group that experience the greatest volatility in the labour market, she warns.
So when the economy takes a downturn, it's young people who are more likely to lose their jobs or to struggle to get a foothold in the job market.
Mr Nguyen now works at an AI start-up, where much of the low-level admin work has already been handed over to machines.
His employer, Julian Fayed, says the shift is accelerating.
Our technology is advancing, and our AI implementations are advancing at a rate that means that our headcount isn't really growing anymore, he says.
A lot of the lower-level tasks our team didn't enjoy doing, AI can now do 24 hours a day, seven days a week.
No sick days. That's the slightly dark joke.
Beyond small tech start-ups, some of the country's biggest employers are also preparing for a leaner future.
Telstra CEO Vicky Brady has been up-front at several public events about how advances in AI will result in job cuts.
We know that work is going to look very different in 2030 — and so will we, Ms Brady told a recent investor briefing.
CBA boss Matt Comyn made similar comments when he appeared at the Australian Financial Review's AI summit in Sydney this month.
It's hard to make predictions, Mr Comyn said.
But I think in some areas, it's reasonable to say the workforce will be smaller.
Recruiters say AI will replace entry-level jobs
Dario Amodei — CEO of US-based AI company Anthropic — has warned that up to 50 per cent of entry-level white-collar jobs could disappear within five years.
Aaron Matrljan from recruitment agency ALRA agrees junior positions will be among the first to go.
Recruiter Aaron Matrljan expects his professional services clients to make staffing decisions based on AI within the next two years. (ABC News: Daniel Irvine)
Things that we would get juniors to be trained on — that would usually be a learning exercise for them — can now be done so much more cheaply and effectively by AI in a matter of seconds, he explains.
Mr Matrljan says his professional services clients are all talking about AI.
Once people master it, the next step is: how does that affect staffing?
Mr Matrljan expects to see job cuts because of AI becoming more common within the next two years, and believes slower economic conditions will only speed up the take-up of technology.
The next intake of graduates is going to be really interesting, and firms are going to have to work out where they're gaining those efficiencies, where they're gaining the cost savings, and how many grads do we need, how many trainees do we need to do the tasks that AI can do now so much quicker.
Businesses that don't adopt AI risk being left behind, particularly as the technology promises major productivity gains.
The optimistic view of AI is that the technology won't replace human workers but instead allow them to take on higher-level tasks.
Productivity is about shifting our time away from the lowest value activities and the lowest value tasks that can be done by automation or AI or computers, and reallocating our time towards the most valuable uses, the most purposeful and meaningful uses, Dr Risse argues.
We don't want to outsource what makes us human to computers or to robots. We want to hang on to that and elevate that.
Higher productivity equals higher wages … or profits
Dr Risse said AI can be of huge benefit to workers if the transition is managed equitably.
If you have higher labour productivity, you have a case for a higher wage, she explains.
What we've then got to make sure is that that increase in labour productivity flows through to higher wages. Otherwise, the benefits of that higher productivity are going to be absorbed by profit.
Some jobs will inevitably be replaced by AI, particularly routine roles that are easier to automate because they follow predictable, repetitive patterns.
The reality is, as Dr Risse says, some workers will need to find new jobs in new industries.
The care and community sector is growing, particularly as a result of the aging nation. We need humans. We need people in those sectors, she argues.
But for some people in areas like banking or finance, that can feel like a big leap.
As AI advances, the question is no longer if it will dramatically change the workforce, but how quickly, and whether Australia's job market can adapt in time.
Mr Fayed believes there'll always be white-collar jobs for the right candidate.
However, landing a position is likely to become more competitive.
If you could put in front of me people who are really skilled, critical thinkers, problem solvers, I'll take as many of them as I can possibly hire.
His advice to students is blunt.
Employers say they are generally looking for critical thinking skills over technical capabilities that are easily replicated by AI. (Unsplash)
For anyone thinking about what to study — you absolutely should be considering whether your future role is at risk from AI, Mr Fayed said.
I do think this is going to be very, very disruptive.
There's also a risk for companies that cut too deep — they could lose the pipeline of workers who would eventually move into mid-level and senior roles.
Firms are going to have to … work out where they're gaining those efficiencies, where they're gaining the cost savings … how many grads do we need, how many trainees do we need to do the tasks that AI can do now so much quicker, Mr Matrljan says.
What that's going lead to is the next two to four years it's going be really interesting to see, because there's not as many juniors coming through the ranks … have we lost a lot of knowledge at that level?
https://www.abc.net.au/news/2025-06-21/ai-job-fears-accelerate-white-collar-grad-roles-threatened/105440772
