AI agents could easily send college grad unemployment over 30%, ServiceNow CEO says

Artificial intelligenceadoption could lead to significantjob strugglesfor entry-level workers as companies boost productivity, according toServiceNowCEO Bill McDermott.

McDermott told "Squawk on the Street" on Friday thatunemploymentfor newcollege graduates"could easily go into the mid-30s in the next couple of years."
"So much of the work is going to be done by agents.

So it's going to be challenging for young people to differentiate themselves in the corporate environment," he added.

TheFederal Reserve Bank of New Yorkput the unemployment rate for recent college graduates at the end of 2025 at about 5.7%.

The underemployment rate of 42.5% was the highest level since 2020.

Across industries, businesses are slashing costs and cutting jobs with the help of new AI tools.

Last month,Blockannounced plans tocut nearly halfits workforce as AI automates more work.

Meanwhile, software firmAtlassian, which has seen its stock dive 54% this year on AI disruption fears, said this week itwould lay off about 10%of its workforce to support AI investments.

Compared to previous technological revolutions, experts say AI is chipping away at manywhite-collar jobs, including coding and marketing roles, and allowing companies to reduce hiring and improve productivity with fewer workers.

PalantirCEO Alex Karppreviously told CNBCthat he wants to grow revenue by 10 times while reducing headcount.AmazonCEO Andy Jassysaidin June that the company will also shrink its corporate workforce with AI tools.

McDermott told CNBC that ServiceNow's tools will help businesses slash hiring costs, adding that the software firm has already taken out 90% of the use cases that previously relied on humans in customer service.

It also allows businesses to maintain headcount while growing free cash flows and revenue.

"I do think it's coming quicker than people anticipate," he said.

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