While business leaders across the globe grapple with AI’s impact on their workforce, many are making a critical error in their talent strategy.

The prevailing wisdom suggests that AI will eliminate entry-level positions, making fresh graduates less valuable than ever.

David Ellis, Managing Partner of IBM Consulting for Australia, believes this thinking is not just wrong – it’s strategically dangerous. To prove his point, he raises Anthropic CEO Dario Amodei’s concerns about AI’s impact on the job market.

“He very famously said that he thought that 50 percent of entry-level jobs were going to be displaced by AI,” Ellis says on CEO: Behind the Scenes.

The concern is understandable when you consider that traditional graduate tasks, such as document restructuring, primary research and code debugging can now be performed extraordinarily well by AI models.

But Ellis sees a different future. Rather than eliminating graduate positions, IBM Consulting is actively increasing them.

“So, for example, we are increasing, not decreasing, the number of graduate hires that we’re making here in Australia,” he says.

Investing in the future

The reasoning is both strategic and generational. Today’s graduates enter the workforce with a crucial advantage – they’ve been using AI longer than most experienced workers.

“We have people entering the workforce that have perhaps been using AI longer than many others. Maybe they’ve been using it through their studies. Maybe they’ve just got a deeper affinity to it,” Ellis explains.

When properly equipped and trained, these AI-native workers can be a huge asset to organizations.

“We can skill them, we can equip them, we can give them the confidence to be much more effective than you or I might have been at the beginning of our careers,” he says.

This isn’t just theoretical optimism. Ellis speaks from experience leading IBM Consulting’s own AI transformation. The company has been applying AI across its business since 2018, achieving remarkable results.

“In different parts of our business, we’re seeing 50–80 percent productivity improvement with the tools that we’re giving people,” he says.

“Over the last two years, we’ve had an impact of about A$3.5 billion dollars in terms of the impact within IBM.”

Navigating challenges

The transformation wasn’t without challenges. Ellis candidly admits its initial AI rollout in HR was a disaster, causing employee satisfaction scores to plummet from around 30 to minus 20.

“We rolled out a whole bunch of tools, we took away a whole bunch of capability and we didn’t really give the full consideration to the change management,” he reflects.

The lesson was clear: technology alone wasn’t enough, and proper training and support was needed.

For Ellis, this isn’t just about business strategy. He is acutely aware of what’s at stake for the next generation.

“We can’t afford to leave a generation behind,” he insists. “We can’t afford the former to be the full picture.”

The approach requires intentionality. IBM has established delivery centers on university campuses, allowing students to earn while they learn.

“Some of my best days in the office are when I’m speaking with people, many of them interns – just the energy, the ideas, the creativity,” Ellis says. “I’m amazed at the quality of the work that they’re able to deliver.”

As well as the altruism of this strategy, Ellis argues there’s also an important stewardship aspect to consider.

“IBM is more than 100 years old. I’ve got very great confidence that this business will outlive me,” he says. “So we need to be building these businesses for generations to come.”

The key is recognizing that rather than simply eliminating jobs, AI is transforming them. And rather than replacing young workers, smart leaders are using AI tools to amplify their capabilities, creating opportunities for graduates to achieve far more than previous generations could at the same career stage.

“What a time to be alive, the things that we will be able to do here,” Ellis enthuses. “But we just need to make sure that we’re doing that in a way that really takes our people with us.”

Listen to the latest episode of our CEO: Behind the Scenes podcast with David Ellis on Amazon, Apple or Spotify.