AI is rewriting the entry-level finance job

Good morning. Many chief financial officers (CFOs) are not giving up on junior talent, but they are rejecting the traditional methods of developing it. This is the subject of a conversation I had with James Tucker, who leads corporate finance and strategy globally at Boston Consulting Group (BCG). Tucker talks to hundreds of finance chiefs each year.

He notes that entry-level hiring has not ceased entirely, but the job itself is being redefined in real time. According to Tucker, the old model of hiring individuals who studied accounting and excelled at performing repetitive, high-accuracy tasks has now changed. Companies once hired large groups to handle routine finance tasks such as reconciliations, journal entries, and basic reporting.

They then observed who excelled and promoted them. However, AI is revolutionizing this approach. The new paradigm is one where fewer people are hired for their judgment rather than their ability to execute tasks, serving as quality control for AI-driven systems rather than generating the figures themselves. There is a tension between the tasks AI takes over and how junior employees traditionally acquired judgment.

AI can manage research, drafting, and problem decomposition, leaving fewer opportunities for junior employees to hone these skills. This is evident in the data. A recent Harvard study suggests that the adoption of generative AI could lead to a reduction in hiring of junior workers, especially in AI-exposed roles, with a lesser impact on existing senior workers.

In a BCG global study of C-suite leaders, half reported observing "de-skilling" in their organizations, and more than 60% anticipate it to become a significant issue within three to five years. Over half cited slower development of junior talent as the root cause. So, what should CFOs do? Tucker advises CFOs to shift from volume to concentration, replacing automation with apprenticeships.

Instead of spreading the remaining manual, judgment-based tasks, such as the approximately 10% of reconciliations resistant to automation, across a large group of junior employees, firms should focus these assignments on fewer individuals, allowing an experience curve to form. Junior staff should also participate directly in real decision-making rather than handling "widgets" in the back office, enabling them to absorb judgment through observation and repetition.

Rotating between finance and the broader business can be beneficial as well. Tucker identifies a consistent gap in junior talent: strong technical skills but weak business acumen. To address this, firms are adjusting their hiring criteria. While accounting skills remain valued, there is a growing emphasis on pattern recognition and the instinct to recognize when outputs are incorrect.

Sheryl Estrada can be reached at Sheryl.Estrada@fortune.com. This story was originally published on Fortune.com.