Major AI industry leaders at the World Economic Forum in Davos 2026 are sounding alarms about artificial intelligence’s immediate impact on entry-level employment, with top executives from Google DeepMind and Anthropic confirming they’re already seeing effects on junior hiring.
Demis Hassabis, CEO of Google DeepMind, made a stark prediction during a joint interview at Davos on Tuesday, stating that 2026 would be “the year when AI could mean cutting back on entry-level jobs and internships.” Hassabis noted, “I think there is some evidence, I can feel that ourselves,” suggesting his own company is experiencing these changes firsthand.
Anthropic CEO Dario Amodei echoed these concerns, particularly highlighting the software and coding sectors as early indicators of AI’s displacement effects. “Now I think maybe we’re starting to see just the little beginnings of it, in software and coding,” Amodei said, adding that Anthropic is actively considering “how to deal with this change in a sensible way.”
The AI employment discussion comes amid broader debates about AI infrastructure and adoption challenges at the annual gathering of global business and political leaders. Microsoft President Brad Smith addressed another critical AI issue: local resistance to data centers. Smith acknowledged “completely legitimate questions” from communities concerned about rising electricity prices, water pressure impacts, and job distribution benefits from AI infrastructure projects.
Smith’s comments followed Microsoft’s recent announcement of a “community-first AI infrastructure” plan, which includes commitments to pay higher electricity rates for their facilities. This initiative came after President Donald Trump called on tech companies to “pay their own way” for data centers.
The forum also featured tensions around AI regulation and social responsibility. Salesforce CEO Marc Benioff created an awkward moment by criticizing tech companies’ use of Section 230 protections while sitting near Google President Ruth Porat. Benioff specifically called out Character.AI as “maybe the darkest thing I’ve ever seen with technology” after watching a documentary about its impact on children—notably, Google had paid $2.5 billion to license Character.AI’s technology in 2024.
A key theme emerging from Davos discussions is AI’s failure to deliver expected productivity gains. At a Business Insider roundtable, chief people officers from major corporations discussed strategies for driving AI adoption. Cisco’s experience revealed that mandating AI training actually had negative impacts, while “providing choice” and letting employees select from multiple AI tools proved more successful in driving genuine adoption.
Key Quotes
I think there is some evidence, I can feel that ourselves
Demis Hassabis, CEO of Google DeepMind, confirmed during a Davos interview that his company is already experiencing AI’s impact on junior-level hiring, suggesting the displacement effects are not hypothetical but actively occurring within leading AI companies themselves.
Now I think maybe we’re starting to see just the little beginnings of it, in software and coding
Anthropic CEO Dario Amodei identified software and coding as the first sectors showing tangible signs of AI-driven job displacement, indicating that technical roles once considered safe from automation are now vulnerable.
Those are completely legitimate questions, and I think it’s incumbent on all of us in the industry in the United States to address them head-on and offer the kinds of assurances that people need
Microsoft President Brad Smith acknowledged community concerns about AI data centers’ impact on electricity prices, water resources, and local employment, signaling that tech companies recognize they must address infrastructure externalities.
The biggest theme emerging from my conversations so far this week is that AI hasn’t delivered the tangible productivity gains executives expected
Business Insider reporter Aki Ito summarized a critical disconnect at Davos: despite massive investments and growing concerns about job displacement, AI is not yet producing the promised productivity improvements that would justify these disruptions.
Our Take
The candor from Hassabis and Amodei marks a watershed moment in AI discourse. For years, AI executives have downplayed displacement concerns while emphasizing augmentation and new job creation. Their admission that junior positions are already being cut—within their own organizations—represents a significant shift toward acknowledging AI’s immediate labor market impacts.
What’s particularly striking is the timing and location of these admissions. Davos serves as a bellwether for global business sentiment, and these statements suggest the AI industry is preparing stakeholders for difficult transitions ahead. The focus on “dealing with this change in a sensible way” implies recognition that unmanaged displacement could trigger regulatory backlash.
The productivity paradox Aki Ito identified may be the most important revelation: if AI is eliminating jobs without delivering corresponding efficiency gains, it suggests we’re experiencing disruption without value creation—a fundamentally unsustainable dynamic that could reshape AI investment and adoption strategies.
Why This Matters
This coverage from Davos 2026 represents a critical inflection point in the AI industry’s impact on employment and society. When the CEOs of two leading AI companies—Google DeepMind and Anthropic—publicly acknowledge that their technology is already affecting junior-level hiring, it validates widespread concerns about AI displacement that have been largely theoretical until now.
The focus on entry-level positions is particularly significant because these roles traditionally serve as career pipelines, providing essential training and experience for future professionals. If AI eliminates these opportunities in sectors like software development and coding, it could create a “missing generation” of workers who never gain foundational skills.
The infrastructure challenges highlighted by Microsoft’s Brad Smith reveal another dimension of AI’s societal impact: the technology’s massive resource requirements are creating local conflicts over electricity, water, and community benefits. This suggests AI’s disruption extends beyond labor markets into environmental and community planning domains.
Most importantly, the admission that AI hasn’t delivered expected productivity gains despite these costs raises fundamental questions about the technology’s value proposition and whether current investment levels are justified.
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Source: https://www.businessinsider.com/davos-wef-live-updates-jan-20-2026-1