The job market has been a sore subject for Gen Z. The unemployment rate among young college grads sits at 5.6%, hovering near its highest level in more than a decade outside the pandemic. Meanwhile, prominent executives—from Anthropic’s Dario Amodei to Ford’s Jim Farley—have warned that artificial intelligence will slash corporate entry-level jobs.
But some companies are realizing that cutting young workers out of the pipeline isn’t a sustainable long-term strategy: $240 billion tech giant IBM just revealed it’s ramping up hiring of Gen Z.
“The companies three to five years from now that are going to be the most successful are those companies that doubled down on entry-level hiring in this environment,” Nickle LaMoreaux, IBM’s chief human resources officer, said this week.
“We are tripling our entry-level hiring, and yes, that is for software developers and all these jobs we’re being told AI can do.”
While she admitted that many of the responsibilities that previously defined entry-level jobs can now be automated, IBM has since rewritten its roles across sectors to account for AI fluency. For example, software engineers will spend less time on routine coding—and more on interacting with customers, and HR staffers will work more on intervening with chatbots, rather than having to answer every question.
The shift, LaMoreaux said, builds more durable skills for workers while creating greater long-term value for the company.
With job market conditions likely to stay tight for young candidates in 2026, applicants who show initiative and comfort with AI may be the ones who break through at companies like IBM. According to LinkedIn, AI literacy is now the fastest-growing skill in the U.S.
Cutting entry-level talent could backfire in the long term, according to IBM’s HR head
As AI increases pressure on companies to be leaner and more productive, early-career hiring has often looked like the simplest place to cut. A report from Korn Ferry found that 37% of organizations plan to replace early career roles with AI.
But while that strategy might be helpful with short-term financials, LaMoreaux argued, it could cause havoc in the future.
Reducing junior headcount risks creating an eventual shortage of mid-level managers. Attempting to poach talent from competitors is likely to be costlier, and outside hires tend to take longer to adapt to internal systems and culture.
That’s why, she said, HR leaders need to push back.
“Entry-level hires—it is your responsibility to make the case for that,” she said. “Build the business case now; even though it may not seem so obvious to your leaders, because AI is going to make your job easier three years from now.”
IBM CEO Arvind Krishna has already heard LaMoreaux’s plea and rejected the idea that AI should translate into fewer opportunities for graduates.
“People are talking about either layoffs or freezing hiring, but I actually want to say that we are the opposite,” Krishna told CNN in October. “I expect we are probably going to hire more people out of college over the next 12 months than we have in the past few years, so you’re going to see that.”
Just a week after his comments, however, IBM announced it would cut thousands of workers by the end of the year as it shifts focus to high-growth software and AI areas. A company spokesperson told Fortune at the time that the round of layoffs would impact a relatively low single-digit percentage of the company’s global workforce, and when combined with new hiring, would leave IBM’s U.S. headcount roughly flat.
Fortune reached out to IBM for further comment.
Like IBM, some tech companies are rethinking talent pipelines—and embracing Gen Z
IBM isn’t alone in betting that younger workers may actually accelerate AI adoption. In fact, according to Melanie Rosenwasser, chief people officer at Dropbox, Gen Z are actually coming to work equipped with better AI skills than their older peers.
“It’s like they’re biking in the Tour de France and the rest of us still have training wheels,” Rosenwasser told Bloomberg. “Honestly, that’s how much they’re lapping us in proficiency.”
The file-sharing company is set to expand its internship and new graduate programs by 25% to capitalize on the AI fluency of younger workers.
Ravi Kumar S, CEO of IT firm Cognizant, similarly told Fortune last year that he would be creating more entry-level jobs owing to his bullish view of Gen Z.
“So many companies have a pyramid with the bottom where school graduates are. That pyramid is going to be broader and shorter, and the path to expertise is going to be faster,” he said.
“This year, we are hiring more school graduates than ever before. I can take a school graduate and give them the tooling so they can actually punch above their weight. AI is an amplifier of human potential. It’s not a displacement strategy.”
