Germany abolishes entry-level positions due to advancements in AI technology.
In the ever-evolving world of technology, the role of developers is undergoing a significant transformation, thanks to the AI revolution. This shift is not unique to Germany; similar trends are being observed across the globe.
The tech boom between 2020 and mid-2022 saw massive investment in digitalization and the creation of numerous new jobs. However, since spring 2022, the economic downturn, not AI, has primarily driven a significant decline in job advertisements in the entire labor market and particularly in the IT sector.
Despite the shrinking IT job market, it is evolving strongly towards AI specialization. The demand for AI skills has increased in the general IT job market, with AI competencies mentioned in around 3 percent of all job advertisements on the entire labor market, and much higher in tech jobs such as data and analytics, software development, and IT applications and solutions.
This shift towards AI has had a noticeable impact on entry-level jobs, particularly junior positions. In Germany, entry-level jobs, especially junior software development positions, have seen a 54 percent decrease, while the number of senior positions has only decreased by 15 percent.
However, the situation on the German IT labor market with the growing use of generative AI is mixed. About 27% of companies expect job cuts due to AI, while 42% foresee new job profiles and increased demand for IT specialists, especially AI experts. The competition for entry-level jobs, especially in tech, has become much tougher in recent years.
It's important to note that AI not only takes over jobs but also creates new opportunities in the labor market. The importance of IT system and infrastructure specialists is growing due to the high computational demand of AI. Activities with a high practical component, such as the provision and maintenance of hardware, are less automatable.
In the long run, companies cannot afford to cut entry-level jobs in favor of AI, as it may lead to a lack of specialists and leaders in the future. The importance of education and training in AI-related fields becomes increasingly crucial.
A comprehensive study by Stanford University researchers found that entry-level jobs in the US labor market, particularly software development, have been affected by AI, with employment of 22- to 25-year-old software developers having fallen by a fifth since late 2022.
While the future of the IT specialist labor market remains uncertain, with questions about whether it will recover when the economy picks up again or whether certain activities will be permanently taken over by generative AI in the medium to long term, one thing is clear: the importance of pursuing a career in IT, especially in AI-related fields, remains significant. Increased competition should not deter young people from pursuing their professional aspirations or passions.
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