Rising Costs and AI Push Gen Z Away From IT Jobs

The concerns over the future of young employment in the global digital economy are raised by the quick drop and decline in the percentage of Generation Z workers in technology companies due to AI, cost-cutting strategies, and brain drain.

Data from the salary analytics platform Pave shows that the percentage of workers in big public IT businesses between the ages of 21 and 25 decreased from 15% in January 2023 to 6.7% in July 2025. Over the same time period, private tech companies had a comparable decline, going from 9.3 percent to 6.7 percent.

The data also shows that companies are prioritising operational efficiency and expediting the implementation of artificial intelligence (AI), resulting in a widespread restructuring of the tech workforce.

Entry-level positions which is supposed to be for starters for younger ones after leaving varsity and that were previously held by younger employees in fields like data analysis, customer service, and software engineering are being automated or abolished. Consequently, in less than three years, the average age of employees in publicly traded tech companies has increased from 34.3 to 39.4 years.

This trend is supported by a Stanford University research, which found that while older workers mostly continue in their positions, employment among 22 to 25-year-olds in automation-prone occupations has decreased by 13% since 2022.

Elite graduates are not exempt from this; in 2024, 15% of Harvard Business School grads were still looking for work three months after graduation, up from 4% in 2021.

The situation is even more complex, according to Samson Simon, chief economist at ARKK Economics & Data Limited, who connected the dwindling number of Gen Z workers in the IT industry to more general economic realities including cost-cutting, inflation pressures, and Nigeria’s high rate of youth unemployment.

It’s possible that IT companies are trying to save expenses by hiring fewer Gen Zers. Additionally, Gen Zers are choosing foreign employment that pays in the powerful US dollar. Additionally, AI is a factor, and a lot of bright young techies are opting to launch their own companies rather than work for an employer,” he said.

According to a World Bank research, sub-Saharan Africa has been losing its most educated and youthful labour force to other markets, especially those in North America and Europe.

More than 65 percent of tech workers who relocate from Nigeria alone are under 30, according to the survey. They are frequently drawn by the prospect of remote work, higher wages, and international mobility.

As foreign firms increasingly draw the top software engineers, product designers, and data scientists, the Nigerian Economic Summit Group has also cautioned that brain drain in the IT industry space could hinder innovation domestically and deepen the nation’s digital divide.

Experts say that the answer to preparing for the future is to provide young people skills that go beyond entry-level computer jobs or traditional coding.

Simon made claims to say that young people without jobs need to make sure they learn unique skills that are highly sought after—making themselves invaluable to their employers.

“Gen Zers are not the only ones who should get ready to be more marketable. According to Uchenna Uzo, a professor of marketing management at the Lagos Business School, tech companies must also get ready to draw in the young talent they need to expand.

Tech companies need to make intentional investments in workplace culture to match this, he said.

However, he issued a warning not to assume that Nigeria is directly affected by the worldwide slump.

“I wouldn’t claim that the percentage of Gen Z employees in Nigerian IT companies is declining just yet. “A lot of the CEOs of tech companies here are very young, and they work primarily with young people,” he remarked.