Entry-level hiring in European tech has collapsed, down 73%

According to EU-Startups, entry-level hiring across European tech has collapsed, with a 73% year on year drop in new graduate and junior hires. Multiple reports show this dramatic decline sits alongside a modest 7% overall hiring fall and a sharp rise in experience requirements for roles still labelled as junior. AI driven applicant tracking systems and keyword filters are already excluding many new graduates, converting what once was a steady intake into a trickle.

What the numbers say

The scale of the shift is stark. New graduates now make up under 6% of startup hires, down more than 30% from pre pandemic levels, and major tech companies have halved their graduate intake since 2022. Projections through 2035 are already worrying policy makers, with Germany alone facing a projected shortfall of 7 million skilled workers. European firms report labor shortages roughly 30% higher than peers in North America and Asia, a gap that will widen if junior hiring remains depressed while demand for local technology increases.

Two factors are colliding. First, short term efficiency drives are pushing hiring managers to use AI and ATS filters to reduce screening time, and to reclassify roles so that ostensibly junior jobs require multiple years of experience. Second, demand for local capacity is rising because Europe is attempting to build an independent tech stack. The move to localise compute and services is visible in product and infrastructure plays such as Mistral AI buying the French serverless startup Koyeb to fold deployment infrastructure into its stack, and larger investments in European data center capacity. Those efforts increase competition for the same finite pool of talent while the intake pipeline is shrinking.

This is not just a hiring metric. The mid level talent pipeline is the engine that turns graduates into reliable senior engineers, product managers, and operations leads. When that engine stalls, the result is higher recruiting costs, wage inflation for existing senior staff, and slower feature development for teams attempting to build European alternatives to large US platforms.

The short and long term impact

In the short term, companies that skip junior hiring will see cost savings from smaller headcount and faster recruitment cycles. In the medium term, those savings evaporate. With fewer mid level engineers arriving after three to five years, firms will face poaching pressure on existing seniors, higher salaries, and gaps in institutional knowledge. For European products competing with US incumbents, the practical effect will be slower product road maps and higher operating costs. Governments and industry groups may be forced to step in with incentives for apprenticeships or structured graduate programs, but policy responses lag market shifts.

Geopolitics intensifies the urgency. Polling reported by Politico shows growing distrust in allied suppliers, which feeds the push for local alternatives and increases demand for home grown engineering capacity. Sifted has flagged how geopolitical shocks can quickly turn everyday infrastructure, like payments rails, into a strategic vulnerability. Those strategic priorities mean Europe needs more junior engineers, not fewer.

What You Should Do

If you lead hiring or product teams, stop treating junior roles as optional. Start or expand structured graduate programmes and hire to train models, remove unrealistic experience requirements from junior postings, and pair junior hires with AI tools so they increase productivity instead of being replaced by automation. For procurement and product leaders evaluating US versus EU options, factor a talent tax into your total cost of ownership: EU hosted or developed alternatives may require higher upfront investment in people now, but they avoid vendor concentration and geopolitical risk later.

Watch whether companies begin to pilot rotational programmes and whether EU governments launch targeted incentives to rebuild the pipeline. If those signals do not appear in the next 12 months, expect faster wage inflation and a tangible slowdown in the pace at which European alternatives can scale.