ServiceNow CEO Bill McDermott raised concerns about the potential impact of artificial intelligence (AI) on employment, particularly for recent college graduates. He suggested that unemployment rates for this demographic could rise to the mid-30s within the next couple of years as AI increasingly automates tasks traditionally performed by humans.
McDermott highlighted the challenges young workers may face in distinguishing themselves in a corporate environment where AI agents are taking over many roles. This sentiment is echoed by the Federal Reserve Bank of New York, which estimates that the unemployment rate for recent graduates will be approximately 5.7% by the end of 2025, with an underemployment rate of 42.5%, the highest since 2020.
The trend of job cuts linked to AI adoption is evident across various industries. Companies like Block and Atlassian have announced significant layoffs driven by the need to reduce costs and enhance productivity through AI technologies. Experts note that this technological shift is affecting white-collar jobs, including positions in coding and marketing, as firms look to streamline operations.
McDermott further noted that ServiceNow's own tools have already reduced the need for human involvement in customer service by 90%. He believes that the acceleration of AI implementation will occur faster than many anticipate, allowing businesses to maintain their workforce while simultaneously increasing revenue and cash flow.