IMF Warns AI Is Shrinking First Jobs for Young Graduates

The International Monetary Fund has warned that artificial intelligence is reducing entry-level jobs for young graduates, with developing economies most at risk. IMF Managing Director Kristalina Georgieva said demand for first jobs after graduation is already falling in sectors most exposed to automation and AI.

She spoke during the 2026 World Bank and IMF annual meetings at a World Bank Group flagship event titled Small AI: More and Better Jobs. The warning came as world leaders called on governments and businesses to act.

AI could affect 40% of global employment

Georgieva said AI could affect about 40% of global employment through job augmentation, downgrading or outright elimination. She said routine and repetitive roles are disappearing even as entirely new types of work emerge elsewhere.

She urged governments to monitor labour markets closely, reform education systems and champion lifelong learning. Workers, she said, must continuously update their skills rather than rely on a single career path.

First jobs are already under pressure

Singapore President Tharman Shanmugaratnam said the squeeze on entry-level positions is already visible in labour market data. He said: 'The first job upon graduation is now seeing less demand. The evidence is already very clear.'

Tharman warned that developing countries risk a growing divide between economic output and actual job creation if they fail to respond. He pointed to economies recording strong growth while generating insufficient employment. He said passive governments could allow AI to widen that gap further.

He argued that losing access to a first job is more damaging than it appears. Early work experience builds skills and confidence that shape the rest of a graduate's career. He said: 'We can't afford to lose that.'

He called on governments to work directly with private businesses to ensure fresh graduates are recruited rather than passed over in favour of AI-assisted workflows. He also warned that prolonged delays in landing a first job could leave entire cohorts of graduates competing against each other for shrinking opportunities over successive years.

Universities must adapt, and Nigeria has a skills plan

Tharman pressed universities and other tertiary institutions to move beyond a heavy reliance on academic credentials and build stronger links with workplaces through internships, practical training and structured attachments. He said the connection between a degree and a clear career path is weakening, and education systems must adapt to what employers need rather than what they needed a generation ago.

The broader discussions at the meetings centred on how governments, schools and private employers can coordinate responses to ensure AI adoption supports job creation rather than displacing workers most in need of a foothold in the economy.

In Nigeria, the federal government has launched the Digital Training Academy, a free skills programme targeting 32,000 Nigerians across the country's 36 states and the FCT. The academy is part of the National Skilling Project and is being run in partnership with global learning platform Coursera. Successful applicants will receive free learning licences at no personal cost.

What it means for Nigerian graduates and businesses

For Nigerian graduates and businesses, the IMF warning points to a tougher entry-level job market as AI tools spread. The pressure will be strongest in routine roles, making skills training, internships and closer links between employers and universities more urgent. The immediate question is whether Nigeria's skills programmes can prepare enough workers for the shift.