A report from the Institute of Student Employers (ISE) has found most employers expect AI to reshape rather than replace entry-level jobs over the next three years.
This year’s Student Development Survey found 87 per cent of employers expect AI adoption to reshape graduate and apprentice roles. While 58 per cent foresee minor adjustments to tasks and responsibilities, almost a third (29 per cent) anticipate significant changes – particularly in FMCG and tourism (56 per cent) and the legal sector (41 per cent).
A further 43 per cent said that their entry-level roles had already evolved in response to AI, but have not been formally redesigned. Interestingly, most employers don’t expect widespread change with 72 per cent anticipating up to a quarter of jobs being affected, although 28 per cent foresee more than a quarter.
Changing skills needs indicate how work may evolve. Employers said that critical thinking, AI literacy, communication and adaptability will grow in importance, while routine admin, basic data and writing tasks will lessen in significance.
The survey of ISE members – large employers of graduates and apprentices – also found that widespread job displacement is unlikely over the next three years. Forty per cent don’t expect to replace any entry-level roles by AI and 42 per cent believe only a small number (1–10 per cent) will be affected. Just 18 per cent anticipate larger-scale replacement (more than 10 per cent of jobs).
With over half (54 per cent) of employers concerned about the future impact of AI on new hires, they are preparing them for change. Mental health and wellbeing support is a growing priority as employers reported more issues with anxiety, career uncertainty and burnout.
Digital and AI skills are also prioritised and viewed as something to develop after hiring – employers are almost twice as likely to build digital literacy on the job than recruit for it. Practical use of AI tools as well as data and digital skills are also commonly embedded in training.
However, ISE also found growing concerns around how AI may be used by candidates during recruitment. This year two-thirds of employers believed graduates and apprentices are using AI to misrepresent skills, up from around half in 2025.
Stephen Isherwood, joint CEO of ISE commented: “While some entry-level roles will dramatically change in scope, the shift is less about jobs disappearing and more about tasks evolving.
“AI will take away some of the more routine admin work, but graduates and apprentices will need strong critical thinking and sound judgement,” he added. “How you think and apply yourself have always mattered, but they will become even more important for success in the AI age.
“As the pace of change accelerates, new hires must be ready to adapt to evolving demands. This will require targeted development and the right support, particularly to help manage potential mental health and wellbeing challenges.”
ISE Student Development Survey 2026 is among the first pieces of major research to align with the new UK Standard Skills Classification from Skills England.
