6 in 10 of Britain’s largest employers say AI has already cut their entry-level jobs

Six in ten of the UK’s largest employers said investment in AI or automation had already reduced the number of entry-level roles in their organisation.

The Work Foundation at Lancaster University commissioned the Survation survey of 1,001 senior UK business leaders behind the finding, publishing the analysis on Wednesday (26 August).

Across employers of every size, 43% said AI or automation investment had cut entry-level roles, and 44% said they had already used AI or automated systems to screen job applications.

Among large employers those figures rose to 60% and 64% respectively.

Large firms were 2.5 times as likely as small firms to say the technology had removed entry-level roles, and almost twice as likely to report cutting them.

Entry-level jobs are shrinking across the board

More than one in three employers (36%) said they had reduced entry-level jobs over the past 12 months.

The cuts sat heaviest in bigger organisations, with 48% of medium-sized employers and 46% of large employers reporting reductions, against 24% of small firms.

More than one million 16 to 24 year olds in the UK are now not in education, employment or training, the highest number since 2013.

The Work Foundation calculated there is one starter vacancy nationally for every three young people in that position.

Employers agree there is a crisis

Nearly three quarters of business leaders (73%) described the NEET figures as a national crisis, and 76% agreed employers had a responsibility to do more.

The same survey found 60% believed 16 to 24 year olds were generally ready for the world of work, while 73% thought they faced greater barriers than five years ago.

Employers still favoured credentials when recruiting for junior roles, with 63% prioritising education qualifications and 62% prior work experience.

“I want the work, but the work does not want me,” one young person told researchers at Work Foundation workshops in Morecambe and Liverpool.

A capacity gap between large and small firms

Just under three quarters of employers (72%) said they could support a young person taking their first steps into work.

That fell to 62% for young people out of education and work for six months or more, and to 60% for those with a long-term physical health condition or disability.

Small firms reported the weakest capacity, with 44% saying they could support someone out of work for six months or more and 40% saying they could support a young disabled jobseeker, against 80% and 78% of large employers.

Almost three in five employers (59%) offered placements, apprenticeships, internships or work experience over the past year, and the same proportion gave feedback to unsuccessful young applicants.

What the government has put in place

The Jobs Guarantee will give eligible 18 to 24 year olds who have claimed Universal Credit and looked for work for 18 months a fully subsidised six-month paid job with wraparound support, starting later in 2026.

The government expects the scheme to reach 90,000 young people over the next three years.

The Youth Jobs Grant, which opened to employers on 30 June 2026, pays £3,000 for every eligible young person hired and targets up to 60,000 people aged 18 to 24 over the same period.

The CBI has argued that rising business costs have reduced entry-level jobs and called on the government to lower National Insurance thresholds for under-25s.

Resolution Foundation analysis estimated that change would cost 3.5 times more per job created than the Jobs Guarantee and the Youth Jobs Grant.

The Work Foundation argued that subsidised roles must be genuinely additional rather than replacing jobs employers would have created anyway, and that employers taking public money should have to review whether prior experience and formal qualifications are truly essential and how they use AI to screen candidates.

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