Sunak warns AI cuts entry-level jobs as China’s youth unemployment hits record highs

Former UK Prime Minister Rishi Sunak has warned that artificial intelligence is flattening the jobs market for young people, particularly graduates struggling to secure entry-level positions. According to a BBC report, Sunak stated that these concerns are justified amid rapid AI adoption reshaping early-career opportunities.

This perspective echoes stark labor market challenges unfolding in China, where unemployment among key young age groups has surged to record levels. Official data from China's National Bureau of Statistics, released this week, shows the jobless rate for 25- to 29-year-olds climbing to 7.7% in March—the highest since the agency began tracking this demographic separately more than two years ago. This marks an increase from 7.2% a year earlier and reflects broader distress in the world's largest labor force of over 700 million workers.

The situation is even more acute for younger workers, with unemployment for those aged 16 to 24—excluding students—reaching nearly 17%, or 16.9% specifically, following six straight months of rises. Nationwide, the overall urban unemployment rate ticked up to 5.4% in March, the highest in a year, while rates climbed in 31 major cities. Analysts, including those cited by Bloomberg, attribute part of this to widespread but still shallow AI adoption, which is amplifying employment risks for early-career job seekers alongside seasonal pressures and global spillovers like the war in Iran.

These trends highlight a growing global pattern where AI tools are automating routine tasks traditionally filled by graduates and young professionals, from data entry to basic analysis. In the UK, Sunak's comments underscore fears that entry-level jobs are vanishing faster than new ones emerge, leaving graduates in a bind. In China, the pressure intensifies with a record 12.7 million students set to graduate this summer, flooding an already competitive market where youth unemployment far exceeds rates in most developed nations, typically around 10-11%.

The implications extend beyond individuals to economies at large. Businesses in both regions report slower wage growth—China's at its weakest since late 2022—signaling reduced consumer spending and potential drags on recovery. Young workers face prolonged job searches, skill mismatches, and mental health strains, while governments grapple with policy responses like retraining programs or AI regulations.

Looking ahead, experts anticipate further volatility. China's labor market could worsen with new graduates entering, while seasonal factors may ease slightly but not offset AI-driven disruptions. Sunak's intervention suggests Western leaders may push for similar debates on workforce adaptation, urging education systems to prioritize AI literacy and human-centric skills that machines can't yet replicate. As reported across sources like Bloomberg and the BBC, the core challenge remains: balancing technological progress with equitable job access for the next generation.