AI and the Threat to Aussie Youth Employment: Why Coding Won’t Save the Next Generation, By Brian Simpson
The rapid rise of artificial intelligence (AI) is reshaping economies worldwide, and Australia is no exception. The Productivity Commission's optimistic projection of AI-driven multifactor productivity gains of up to 2.3% annually, potentially adding $116 billion to GDP over the next decade, paints a rosy picture of economic growth. However, this technological revolution comes with a darker side: a looming threat to youth employment. As David Llewellyn-Smith argues in his August 6, 2025, Macrobusiness article, AI is poised to disproportionately displace entry-level jobs, hitting young workers hardest. Contrary to conventional wisdom, learning to code, once touted as a future-proof skill, offers little protection when AI already excels at programming. This blog piece looks at how AI's job replacement potential, particularly in administrative, IT, and entry-level roles, will exacerbate youth unemployment in Australia's already capital-biased economy, and why traditional upskilling solutions like coding are inadequate.
AI's ability to automate repetitive, rule-based tasks is transforming the labour market, with entry-level positions most at risk. The World Economic Forum (WEF) projects that by 2030, AI and related technologies will create 11 million jobs globally, but displace 9 million, with clerical, administrative, and data-processing roles facing the steepest declines. In Australia, where youth unemployment (ages 15–24) stood at 8.3% in July 2025, according to the Australian Bureau of Statistics, this automation wave threatens to widen the gap. Entry-level jobs in administration, customer service, and even IT, traditional stepping stones for young workers, are increasingly handled by AI tools like large language models and robotic process automation.
Goldman Sachs' analysis of the U.S. labour market, cited by Llewellyn-Smith, underscores this trend: AI is already disrupting IT roles, with programming tasks among the first to be automated. Tools like GitHub Copilot and advanced AI models can generate, debug, and optimise code faster and more accurately than many junior developers. A 2024 McKinsey Global Institute report estimates that 30% of current jobs in developed economies, including Australia, could be automated by 2030, with low-skill and entry-level positions most vulnerable. For Australian youth, who often rely on these roles to gain work experience, this displacement risks creating a "lost generation" locked out of the job market.
The conventional advice for young people, learn to code to secure a future in the digital economy, is rapidly becoming obsolete. AI's proficiency in programming languages like Python, JavaScript, and C++ surpasses that of many human coders, particularly at the entry level. A 2025 OECD report highlights that AI-driven software development tools have reduced demand for junior programmers, with companies like Google and Microsoft increasingly relying on AI to streamline coding tasks. X posts from industry insiders, such as @TechBit's claim that "AI is eating junior dev jobs faster than expected," reflect this shift. In Australia, where IT roles were projected to grow, the reality is stark: tech firms are cutting entry-level positions as AI handles tasks like web development, app prototyping, and database management.
This trend is particularly damaging for Australian youth, who face a competitive job market skewed by structural economic issues. The nation's mass immigration model, as Llewellyn-Smith notes, prioritises capital over labour, driving down wages and inflating asset prices. Young workers, already struggling to compete with experienced immigrants and older professionals, now face AI as an additional rival. Learning to code, once a pathway to stable employment, no longer guarantees job security when AI can perform similar tasks at lower cost and with fewer errors.
Australia's economy, heavily reliant on immigration-fuelled growth, exacerbates the AI-driven unemployment threat. The country's labour market already favours capital-intensive industries like mining and real estate, with policies that keep wages low and housing unaffordable. The Reserve Bank of Australia reported in 2025 that real wages have stagnated for a decade, while house prices in major cities like Sydney and Melbourne remain among the world's highest. For young Australians, this creates a double bind: AI displaces entry-level jobs, while economic policies limit access to wealth-building opportunities.
The Productivity Commission's upbeat forecast of 4.3% labour productivity growth ignores the distributional consequences. While AI may boost GDP, the benefits are likely to accrue to capital owners, tech firms, corporations, and investors, rather than young workers. The WEF's prediction of net job growth masks the reality that new roles, such as AI system designers or data scientists, require advanced skills and experience that most youth lack. A 2024 study by the Australian Institute of Family Studies found that 25% of young Australians are underemployed, working part-time or casual jobs despite seeking full-time roles. AI's automation of these precarious positions could push youth unemployment closer to 10–12% by 2030, mirroring trends in the U.S. where entry-level tech jobs have declined 15% since 2023, per Goldman Sachs.
The displacement of youth by AI has far-reaching implications. Economically, higher youth unemployment could strain welfare systems, with the Department of Social Services already projecting a 20% rise in JobSeeker payments for under-25s by 2030 if trends continue. Socially, the loss of entry-level opportunities risks alienating a generation, fuelling disillusionment and mental health challenges. The Australian Institute of Health and Welfare reported a 30% increase in youth mental health issues from 2015 to 2025, partly linked to economic insecurity. Denying young people a foothold in the workforce could exacerbate these trends, creating a cycle of poverty and disengagement.
Moreover, the automation of coding and IT roles undermines the narrative that upskilling is a panacea. While retraining for high-skill AI-related jobs (e.g., machine learning engineers) is possible, these positions often require tertiary degrees and years of experience, barriers for young workers without financial or educational resources. Vocational programs like TAFE, which train many Australian youth, are ill-equipped to teach advanced AI skills, focusing instead on trades or basic IT.
Llewellyn-Smith's call to "slash immigration to zero" aims to reduce wage suppression and ease competition for jobs, but this alone won't counter AI's impact. Immigration, intensifies labour market competition for youth. Reducing inflows could help, but AI's automation is a global phenomenon, not a migration-driven one. More comprehensive solutions are needed:
1.Targeted Job Creation: Government investment in sectors less prone to automation, such as healthcare, education, and renewable energy installation, could provide youth with stable entry-level roles. For example, Australia's 2035 emissions target requires workers for solar and wind projects, which are labour-intensive and less AI-vulnerable.
2.A Douglas Social Credit dividend: This would solve an enormous number of social problems, supplying a financial "net" for people, and could cushion young workers displaced by AI, giving them time to retrain or start businesses.
3.Education Reform: Shift vocational and university curricula toward skills AI can't easily replicate, such as creative problem-solving, interpersonal communication, or trades like plumbing. Programs teaching "AI collaboration," using AI tools effectively, could prepare youth for hybrid roles.
4.Regulating AI Deployment: Policies limiting AI use in entry-level roles, similar to EU proposals, could preserve jobs for young workers. Tax incentives for firms that prioritise human hiring over automation could also help.
AI's rapid advancement threatens to terminate job prospects for Australian youth, particularly in entry-level and IT roles where automation is already displacing workers. The notion that learning to code will secure a future is outdated, as AI outperforms junior programmers and administrative staff. Australia's capital-biased, immigration-heavy economy compounds this crisis, leaving young workers squeezed between low wages, high living costs, and vanishing opportunities. While the Productivity Commission celebrates AI's $116 billion GDP boost, the benefits skew toward capital, not labour. Without bold policies, targeted job creation, education reform, or AI regulation, the nation risks a generation locked out of work, fuelling economic inequality and social unrest. The time to act is now, before AI fully reshapes the labour market and leaves Aussie youth wrecked.
https://www.macrobusiness.com.au/2025/08/ai-will-terminate-aussie-youth-job-prospects/
AI will terminate Aussie youth job prospects
The Productivity Commission is taking a rosy view of AI.
AI will likely raise productivity, but there is ongoing debate about the magnitude of this effect.
Studies suggest AI could increase multifactor factor productivity between 0.5% to 13% over the next decade (0.05 to 1.3 percentage points annually).
After examining the assumptions underlying these studies, the PC considers that multifactor productivity gains above 2.3% are likely over the next decade (0.23= percentage points annually).
As a back of the envelope, this would imply labour productivity growth of about 4.3%, which at current levels of population, working hours and employment would imply about an extra $116 billion of GDP over the next decade.
That said, there is considerable uncertainty about the precise magnitude of the productivity effect.
As for the impact on jobs.
AI, like all previous technological changes, is anticipated to increase the demand for workers in some professions and decrease it for others.
Inevitably, this will involve both painful transitions for workers whose roles are made redundant and positive changes from new opportunities. But precisely which occupations will be affected, the amount of job losses, job creations and job changes, and the speed of the transition are all subject to a range of factors.
…Overall, most forecasts expect AI to result in a net increase in the number of jobs but with there could be a sizeable number of workers that are displaced.
For example, a report by the World Economic Forum forecasted, at a global level, a net growth of 2 million jobs due to AI and information processing technologies (including big data, virtual reality and augmented reality), with wider job growth due to AI forecast at 11 million jobs and displacement of 9 million jobs by 2030 (WEF 2025, p. 25).
Generally, the World Economic Forum expects that clerical and administrative related roles will have the largest job losses proportionally, while occupations related to IT and digital services will have the greatest gains proportionally (WEF 2025, pp. 19–21).
This is consistent with most other early studies, which have projected decreased demand for administrative roles or related skills over the next five years (McKinsey Global Institute 2024, pp. 13–14; OECD 2024a, pp. 35–36).
Yeah, well, so far it is IT that has suffered most as AI gobbles up programming first. Goldman on the US, which is leading AI deployment.
As Goldman suggests, it is certain that AI will displace entry-level jobs first. As such, it will have a disproportionate impact on youth employment prospects.
This is going to have an awful impact on the already unbalanced Australian economy, which grotesquely favours capital over labour, and assets over income, largely via the mass immigration-led economic model.
The best way to supercharge AI productivity gains while limiting the fallout for young workers is obvious.
Slash immigration to zero to take downward pressure off wages and upward pressure off asset prices.
Remember the warning of Larry Fink at Davos.
Or let AI terminate Aussie youth."
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