AI vs AI: What the Graduate Application Arms Race Means for Investment Banks
There is an undercurrent of uncertainty surrounding the future of graduate hiring right now.
Earlier this year, Freshminds hosted senior HR and Early Careers leaders from across Investment Banking to discuss the findings of our 2025 Intern & Analyst Survey – and this uncertainty created a backdrop for the discussion in the room.
Here, we’ll look at the financial pressures shaping graduate career decisions, how AI is transforming the application process for candidates and hiring teams alike, and what both sides should do next.
Graduate Debt and Financial Pressure are Reshaping Career Decisions
At a time when graduate debt is dominating headlines, voices like The Times journalist Mary Downer are capturing the immense anxiety felt by graduates entering the market across a multitude of sectors.
Her reporting in The Times has made clear that today’s graduates are entering the workforce under intense financial pressure. This has sharpened how young people think about money, fairness and long-term career decisions – and it’s changing how they apply for jobs too.
What 8,000 Applicants Revealed About the Pace of Change
In autumn 2025, more than 8,000 students applied through Freshminds to secure a summer internship at selected investment banks in London. As the project lead for these internship schemes, and after speaking to over 500 longlisted students, it’s clear that the market is changing incredibly fast and that we’re in the process of an invention-of-the-internet type transition period.
AI-Inflated CVs are Creating an Interview Consistency Problem
Firstly, we’re seeing a huge shift in the consistency of scoring across interviews, where candidates that we would reasonably expect to perform really well, based on their CVs and written answers to application questions, are not scoring well at all. This seems to be directly related to the increased use of AI in applications, where CVs are edited and tweaked to be almost perfectly the same. Candidates are struggling to bring that same perfect persona to the interview.
Find out more in our article, How AI is Changing Graduate Recruitment and Internship Applications.
Application Volumes are Surging – and Straining Assessment Processes
Secondly, recruitment teams across the sector have seen an exponential increase in applications over the past two years. Apps that allow candidates to apply to tens of applications with one click of a button, with AI answering all the screening questions and polishing their CV, are bringing huge weight and time pressures to previously smooth assessment criteria.
The market has become a battle of AI vs AI, and candidates think they may be left behind if they do not follow suit.
AI Screening: the Question Hiring Teams Can No Longer Avoid
For hiring teams, this raises an uncomfortable question: if you can no longer trust the application, where does screening actually begin? The consensus in the room at our event was that something has to change in how applications are screened - AI screening software, video submissions, and gamified applications all came up. But interestingly, no one in the room was yet using AI to screen at scale. There's something worth noting there - hiring teams are facing an AI-driven problem, but haven't necessarily reached for an AI-driven solution.
Early Careers Strategy: Stay Agile, Go Back to Basics
All this being said, firms should remember that we are in a teething period, mistakes will be made, and that's okay. The worst thing to do is lock in a solution prematurely when the landscape is still shifting this fast. The smartest approach is to stay close to the market, keep experimenting, and not do it alone. It’s also smart to go back to basics and remember that people hire people. Getting as much face time with candidates as possible will always be useful. We find networking events, career fairs and in-person assessment days all make a big impact, even if you’re needing to use the tech to conduct your screening.
Advice for Graduates: Reclaim Your Uniqueness
For any candidates who may be reading this and feeling disheartened – don’t forget to regain your uniqueness. AI applications are temptingly “easy”, but the sooner you understand the power of your personality, the better. Interviews are tough and likely going to get tougher, and if you have to use AI to get into the process, it’s unlikely that you’ll cope with the process, let alone the role itself! But the same notion applies – give yourself some grace to figure out this ever-changing landscape.
For more analysis on how the job market is changing for graduates, and the inexorable march of AI within talent acquisition, read our recent Freshminds article below, and look out for next month’s piece from MD James Callander.
Frequently Asked Questions
We're seeing interview performance drop despite strong applications. What should we do first?
The mismatch between polished applications and weaker interview performance is a signal worth acting on quickly. The most practical next step is reviewing how your early-stage screening is designed, since this is where the disconnect typically lives. Our piece on AI and the New Environment for Early Careers explores the specific assessment design changes firms are making in response.
The volume of applications is overwhelming our team. What are other banks doing about it?
You're not alone; this is the defining operational challenge in early-career hiring right now. Firms are exploring a range of approaches from AI-assisted screening tools to video submissions and gamified assessments, though no consensus has emerged yet. If you're at the point where you need a structural solution, get in touch with the Freshminds team to talk through what a managed graduate scheme could look like for you.
As a graduate, how do I stand out if AI is flattening everyone's applications?
Your personality and genuine understanding of a firm are things AI can't replicate convincingly, especially once you're in the room. The Freshminds Skills Hub has practical guidance on interview preparation and presenting yourself authentically, which is increasingly the differentiator that matters.
What does the broader shift to AI in hiring mean for early careers strategy beyond this year?
The honest answer is that no one has fully figured it out yet. The smartest approach right now is to stay close to the market, keep experimenting, and avoid locking in solutions prematurely while the landscape is still shifting this fast. Watch this space for next month's piece from Freshminds' MD James Callander, which will look at the topic further.
