The Federal Reserve Bank of Dallas found employment down approximately 1% in the top 10% of AI-exposed industries while the broader economy continued to add jobs1. The decline landed mostly on workers younger than 25. The mechanism is not mass termination but collapsed job-finding rates — positions that stopped being advertised rather than workers who were dismissed.
A separate Dallas Fed paper provides the structural explanation2. It distinguishes between "codified knowledge" — textbook procedures, the kind of work that can be documented and therefore automated — and "tacit knowledge", the hands-on expertise built through years of practice that AI cannot readily replicate. Entry-level workers possess mostly the former. Returns to experience are rising in AI-exposed occupations: seasoned workers are gaining pay rises in the same sectors where doors are closing for new entrants.
The pattern has independent corroboration from multiple directions. Year-to-date hiring fell 56% compared with the same period in 2025 , with UBS chief economist Arend Kapteyn attributing record-low white-collar turnover partly to "AI fear." Nonfarm payrolls dropped by 92,000 in February against a consensus estimate of +50,000. Anthropic's own research, by Maxim Massenkoff and Peter McCrory, found no systematic unemployment increase among heavily exposed occupations since late 2022 but identified "suggestive evidence" of slowing hiring of younger workers3 — a finding the Dallas Fed data now independently confirms. ServiceNow CEO Bill McDermott's projection that college graduate unemployment could reach the "mid-30s" within a couple of years4 may be hyperbolic, but the directional trend in the Dallas Fed's data does not contradict the underlying concern.
The long-term risk is structural. If companies stop bringing in junior workers, the pipeline that produces the experienced professionals AI currently complements dries up within a generation. The labour market is not shedding workers in a visible, politically legible way — it is quietly narrowing the entrance. Aggregate employment figures do not register a crisis that is happening in who gets hired rather than who gets fired, which means the policy responses now taking shape in Washington — the Warner-Rounds commission, Sanders's proposed robot tax, California's SB 951 — are calibrated to displacement through firing, not displacement through the slow closure of the entry-level door. The Dallas Fed's data suggests the actual mechanism may already be outrunning the policy framework designed to address it.
