The Work Foundation at Lancaster University found 36 per cent of UK firms cut entry-level jobs for 16 to 24-year-olds as AI rejects job seekers. In a blow to the confidence of young applicants, many are being screened out before a human ever views their submission.
The think-tank reported that 73 per cent of employers now view the rise in youth worklessness as a national crisis, with automated technology directly contributing to the decline in starter positions.
According to the survey, 43 per cent of businesses acknowledged investing in technology that has reduced entry-level roles. Furthermore, 44 per cent of companies use artificial intelligence software to screen job applicants, a figure that rises to 60 per cent among larger firms employing 250 or more staff.
Divya Jyoti, of Lancaster University Management School, said the findings highlighted "a worrying pressure" on those searching for employment in an increasingly automated hiring landscape.
"Young people described applying repeatedly for jobs and hearing little or nothing back," Jyoti said. "Some were left wondering whether their application had been seen by a person at all. That can damage confidence and make an unforgiving jobs market feel impossible to navigate."
Impact on starter positions and hiring costs
The Work Foundation is an independent research organisation and policy think-tank hosted by Lancaster University in North West England. It conducts studies into employment practices, workplace productivity, and labour market trends across the United Kingdom.
The report highlighted that the rise of AI threatens to add to the difficulty facing young adults. Many routine administrative and analytical tasks traditionally assigned to junior employees in professional fields such as accounting and law can now be automated using bots.
Many businesses blame rising operating costs under the Labour government for reducing their capacity to recruit young workers. Employers specifically pointed to sharp increases in employer National Insurance contributions and the statutory minimum wage as major cost drivers limiting entry-level recruitment.
Employer National Insurance is a mandatory tax paid by UK businesses on employee earnings, while the National Minimum Wage sets the legal pay floor across age groups. Substantial increases in both overheads have raised the overall cost of onboarding and training junior staff.
Official youth unemployment statistics
The publication of the report comes ahead of official government figures due tomorrow detailing the number of 16 to 24-year-olds in the UK who are not in employment, education, or training, commonly known as NEETs.
Previous official data revealed that the total number of young people categorized as NEET climbed above one million at the start of this year. The term is widely used by economists and social policy researchers to track economic disengagement among young adults transitioning from education into the workforce.
