AI Disrupts Internship Market: Competition Rises as Opportunities Shrink

Artificial intelligence is reshaping the internship market, driving a sharp decline in available positions and a surge in competition. Handshake, the platform that hosts most college internship listings, reported a 10‑percent drop in postings each of the last three recruiting seasons. Between 2023 and 2025, 30 percent of tech internships and 42 percent of professional‑services internships disappeared entirely, and the average number of applicants per posting climbed to 109 in the 2025 cycle from 62 the year before. These changes coincide with the rise of large language models (LLMs) such as Claude from Anthropic and ChatGPT, which are already automating routine tasks in finance, software development, and legal support.

The shift has not yet displaced white‑collar jobs in bulk. In March 2023 Anthropic identified business, finance, computing and law as fields where LLMs could theoretically displace the most work. Yet since ChatGPT opened to the public in 2022, the ranks of financial analysts, software developers and paralegals have grown 8‑9 percent. What has changed more dramatically is the internship experience. Many interns report that their supervisors now expect them to use AI tools for the bulk of their work.

Jack Vu, a rising sophomore at Rice University, is interning at a private‑equity firm in Houston. “My boss is as into AI as anybody on the planet—he thinks that every second you’re not using AI is a waste,” Vu told reporters. He estimates that Claude, Anthropic’s AI assistant, handles about 90 percent of his tasks. The remaining hours of his eight‑hour day are spent scrolling X, reading books, or watching soccer during the World Cup. Vu said, “Anything you can think of to kill time.” Even when he assigns himself new projects, he relies on Claude to research and draft ideas, saying the model is “inseparable from the work.”

In a different setting, a coder intern at Susquehanna International Group discovered that the tasks his supervisor had assigned—debugging a 15‑year‑old codebase—could be completed entirely by Claude Code. Within two weeks, he finished what the supervisor had budgeted as several months of work. The supervisor, surprised, asked the intern to slow down and keep up appearances. The intern then built a bot to notify colleagues when a trade had cleared, but he hit a learning wall: “I could be way more useful, but I’d need to learn how to use some tool or another tool,” he said. “And in order for me to learn that, someone has to teach me because it’s human knowledge and not, like, something I can look up.” Without additional training, the intern spent much of his time reading classic literature and contemporary social media content.

Not all interns delegate entirely to AI. Finance and tech firms, where AI adoption is already high, often see interns performing meaningful work alongside automated tools. The author of the piece, who spent the summer interning at a magazine, reported a different experience, noting that not all interns are “outsourcing all their work to AI.”

Experts say the purpose of internships remains ambiguous. David Deming, an economist at Harvard Kennedy School, told reporters that internships are primarily a recruiting tool: “My internship exists for the purpose of recruiting future employees.” He added that as routine tasks become automated, some interns may receive more open‑ended assignments, such as passion projects that solve real organizational problems. Janvi Shah, co‑founder and CEO of e‑commerce startup Hue, noted that her data intern now automates reporting for over a hundred clients, freeing time for “higher‑level things” like trend analysis. Shah said, “A huge portion of our thought process with interns is the talent identification,” and that she would keep interns on even if AI could do everything they do.

Despite the shrinking number of internship openings, the proportion of interns who receive full‑time offers after graduation is rising, according to the National Association of Colleges and Employers. As AI tools continue to evolve, employers face a choice: redefine internship roles to emphasize creative problem‑solving and mentorship, or risk losing the pipeline of future talent that internships traditionally provide.