College Graduates Face Toughest Job Market in Over a Decade as AI and Economic Uncertainty Loom

College graduates face toughest job market in more than a decade as hiring slows

WASHINGTON (AP) -- While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia. Zahid, 25, completed her studies in December, but so far she hasn't found a job in the industry that surrounds her. "It stings a little bit," she said. "I never imagined it would be this difficult just to get a foot in the door." Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the coronavirus pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in more than three decades. The rise in unemployment has worried many economists as well as officials at the Federal Reserve because it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration's tariff increases, which could slow growth. "Young people are bearing the brunt of a lot of economic uncertainty," Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions." The growth of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. Higher unemployment for younger graduates has also renewed concerns about the value of a college degree. More workers than ever have a four-year degree, which makes it less of a distinguishing factor in job applications. Murat Tasci, an economist at JPMorgan, calculates that 45% of workers have a four-year degree, up from 26% in 1992. While the difficulty of finding work has demoralized young people like Zahid, most economists argue that holding a college degree still offers clear lifetime benefits. Graduates earn higher pay and experience much less unemployment over their lifetimes. The overall U.S. unemployment rate is a still-low 4.2%, and the government's monthly jobs reports show the economy is generating modest job gains. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads, such as information technology, legal services, and accounting have languished in the past 12 months. The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate -- new hires as a percentage of all jobs -- has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March -- the highest, excluding the pandemic, since 2012, and far above the nationwide rate. Lexie Lindo, 23, saw how reluctant companies were to hire while applying for more than 100 jobs last summer and fall after graduating from Clark Atlanta University with a business degree and 3.8 GPA. She had several summer internships in fields such as logistics and real estate while getting her degree, but no offer came. "Nobody was taking interviews or responding back to any applications that I filled out," Lindo, who is from Auburn, Georgia, said. "My resume is full, there's no gaps or anything. Every summer I'm doing something. It's just, 'OK, so what else are you looking for?'" She has returned to Clark for a master's program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She's hopeful it will lead to a job next year. Artificial intelligence could be a culprit, particularly in IT. Matthew Martin, senior U.S. economist at Oxford Economics, has calculated that employment for college graduates 28 and above in computer science and mathematical occupations has increased a slight 0.8% since 2022. For those ages 22 to 27, it has fallen 8%, according to Martin. Company announcements have further fueled concerns. Tobi Lutke, CEO of online commerce software company Shopify, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI." Last week, Amazon CEO Andy Jassy said AI would likely reduce the company's corporate work force over the next few years. "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs," Jassy said in a message to employees. "We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company." Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, "Why hire a human when you could use AI?" Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn't, said Kory Kantenga, the firm's head of economics for the Americas. "We don't see any broad-based evidence that AI is having a disproportionate impact in the labor market or even a disproportionate impact on younger workers versus older workers," Kantenga said. He added that the Federal Reserve's interest rate hikes have also slowed hiring in tech. Many IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic. In 2022, the Fed began cranking up rates to combat inflation, which made it harder to borrow and grow. In fact, IT's hiring spree when rates were low -- fueled by millions of Americans ramping up their online shopping and video conferencing -- left many firms with too many workers, economists say. Cory Stahle, an economist at the job-listings website Indeed, says postings for software development jobs, for example, have fallen 40% compared with four years ago. It's a sharp shift for students who began studying computer science when hiring was near its peak. Zahid, who lives in Dublin, California, has experienced this whiplash firsthand. When she entered college in 2019, her father, who is a network engineer, encouraged her to study IT and said it would be easy for her to get a job in the field. She initially studied psychology but decided she wanted something more hands-on and gravitated to data analysis. Her husband, 33, has a software development job, and friends of hers in IT received immediate job offers upon graduation a few years ago. Such rapid hiring seems to have disappeared now, she said. She has her college diploma, but hasn't hung it up yet. "I will put it up when I actually get a job, confirming that it was worth it all," she said. ___ AP Writer Matt Sedensky in New York contributed to this report.

Facing entry-level job crunch, new grads question the value of a degree

Graduates arrive at the University of Maryland commencement ceremony in College Park on May 22. (Allison Robbert/For The Washington Post) Ever since she graduated a year ago with a degree in computer science, Maggie Chen, 23, has been searching for her first real job. The process has been grueling and impersonal, she said, involving a lot of ghosting and rejection, which at times has made her "a bit depressed and demotivated." Mostly, "looking on LinkedIn just makes me feel sad," said Chen, who switched to computer science from biochemistry halfway through her undergraduate studies at the University of California at Davis after she got into computers early in the pandemic. Tech appealed to her because it seemed stable and full of opportunity -- and because she wanted to be done with school after completing her bachelor's degree. For Chen, a first-generation college student, the "guilt of being dependent" on her parents after graduation has been "very awful," despite how supportive they are. They encouraged her to follow in the footsteps of friends who are pursuing more advanced degrees to better their chances on the job market, but she is wary about spending more time and money on school. "Everybody tells you, 'Just get a college degree and you'll get a job' and it'll make things easier," Chen said. Now, "a master's is the new bachelor's, I guess." Chen is among the growing numbers of graduates facing a bumpy transition to professional life as they contend with one of the toughest job markets in years for people in their 20s. The unemployment rate for college graduates ages 22 to 27 jumped to 5.3 percent in the past six months ending in May, up from 4.4 percent for the same period a year earlier, according to a Washington Post analysis of Bureau of Labor Statistics data. College graduates in that age group usually have a lower unemployment rate than workers without degrees, but their advantage now is as small as it has been at any point since at least 1994. As summer heats up, grads are peppering social media with frustrated posts about the job search. In interviews, young workers said they are disillusioned with unresponsive recruiters and employers, ghost postings and AI slop on jobsites. Rejection after rejection has left many grads still struggling to find their feet more than a year after graduation, forcing some to question the value of their degrees and pivot, while others take gambles in hopes of working in their chosen fields. @maggiexqc I have cried every single day of this month and struggling with wanting to do many things but constantly having setbacks. This is me keeping myself accountable for a change soo let me know any advice or whether you're experiencing something similar hehe ty for listening <3 #postgrad #postgradlife #depression #mentalhealthawareness #20s #digitaldiary #vlog ♬ growth - Gede Yudis For now, Chen has an internship with a start-up in New York that she hopes will lead somewhere. But she knows she's at a disadvantage vying for full-time roles in the current market. "Everybody being laid off is applying to the same positions as me," Chen said. "They obviously have more experience, so I'm at a loss, I guess." Shrinking opportunities Growth among entry-level jobs across tech, finance and consulting -- the top industries attracting graduates -- has slowed significantly in the past few years, according to data from Revelio Labs, a workforce analytics company: Since the early days of the pandemic, employers have been adding fewer entry-level positions compared with more-experienced roles. Entry-level openings in these fields are down 33 percent compared with 2015, Revelio's data shows. In contrast, non-entry-level openings rose 67 percent in the same period. Lisa Simon, chief economist at Revelio Labs, said that "classic graduate programs in big companies just seem to be recruiting less" as higher interest rates and inflationary pressures weigh on budgets. In this market, "we are seeing an increasing value put on experience and expertise in a lot of areas," she added. Fluctuating trade policies and political uncertainty also are contributing to a "really, really cautious hiring environment" for employers, Simon said. Meanwhile, early-career roles are "seeing the biggest declines from AI exposure," in part because they often involve the kinds of "executable tasks that AI tends to be fairly good at." "There's a lot going on, and, unfortunately, it impacts entry-level jobs the most," Simon said. Manav Raj, an assistant professor of management at the Wharton School of the University of Pennsylvania, said he has noticed "a little more consternation about the job search" from his students. Among those working on their MBAs, there's a sense of diminished job opportunities, Raj said. Compared with what he encountered after graduating in 2015, the entry-level market today is "very, very different," he added. The reasons are myriad, Raj continued, pointing to hiring pullbacks in tech and other industries, as well as inflation and tariff uncertainty weighing on corporate budgets. And the embrace of AI is "changing the way companies are making these investments" in their workforces, he said. "Things have changed really quickly," Raj said. "They may have entered these programs or career paths in an environment where things looked more vibrant. Now there's this sense of uncertainty." Razed pathways Katie Donivan's first job was scooping ice cream. She never expected that more than a year after graduating summa cum laude with a journalism degree from San Diego State University, she'd be back where she started. Donivan, a California native who hoped to be an arts and fashion writer, knew she'd be "fighting tooth and nail" in a media landscape scarred by layoffs and shuttered publications. But these days, it feels to her as if the main barrier is that "it's so hard to convince somebody you can write better than AI." AI-assisted writing tools are everywhere, she noted, and she worries that adoption of these tools in newsrooms could be diminishing entry-level roles. Employment of news analysts, reporters and other journalists is projected to decline by 3 percent from 2023 to 2033, according to the Bureau of Labor Statistics. Donivan has pivoted to applying to marketing and PR roles, but finding even a part-time job has been a challenge. Reluctantly, she has started using AI tools to assist with her job applications to better her chances. "If I don't hop on the bandwagon with everybody else, I will get left behind," Donivan said. @lumber_jaxx Trust the process #postgrad #college #jobsearch #relatable ♬ original sound - LumberJaxx Jaxon Gryder, who graduated in December from Grand Valley State University with a marketing degree, considered college "the best time" of his life. But after more than 100 unsuccessful job applications on LinkedIn alone, the 23-year-old sometimes wonders whether college prepared him well enough for the professional world. Gryder, who worked his way through undergrad, said he learned more from his side hustles working social media campaigns than he did from classes, which he felt were mostly "about hearing about other people's experience." He found it hard to translate the examples he encountered in class to the real world. "They'd give us a study, and the date was 2012, 2006, 1995," Gryder said. "And I'd be, like, 'How is this relevant today?'" In job interviews, Gryder is beyond tired of hearing: "We love you, but you don't have the experience." He is optimistic his upcoming internship -- his first -- with a digital marketing company will help him land a full-time job or open up other opportunities. But for now, he is waiting tables at the same Italian sports bar in the Grand Rapids area where he worked to pay his way through school. His pay waxes and wanes with the crowds, and it has been stressful to operate without a financial safety net. "I have that impostor syndrome" Gryder said. "If I get a job, am I going to be qualified enough? Am I going to know what to do?" @danielamacom pls tell me i'm not alone ?? #foryoupage #midtwenties #relatable #fypシ #postgrad #adulthood #fyp #creatorsearchinsights ♬ original sound - daniela macom For Daniela Macom, getting a foot in the door professionally meant taking "a leap of faith." In June, about a year after she graduated from college with a marketing and communications degree, the 23-year-old drove from her home state of Texas to Southern California to start an unpaid internship with a public-relations company specializing in fashion and celebrity. The gamble felt necessary to Macom after the year she spent applying unsuccessfully to scores of PR and marketing roles, along with internships paid and unpaid. To pay the bills, she worked at an insurance agency, which made her miserable. "The field I want to go into is kind of saturated right now, at least that's what it seems like," Macom said. It was an uphill battle to convince her family that it was in the best interest of her career to quit a stable 9-to-5 job and uproot for an unpaid internship, Macom said. She often wonders whether she's doing the right thing but said she didn't see another way to get her career off the ground. "It might be a huge waste of time, and, on top of that, I don't have a job, but at least I'm doing something," Macom said. "These companies want experience. Well, I'm gaining experience." Andrew Van Dam contributed to this report.

2025's college graduates are facing one of the toughest job markets in over a decade. Here's why

Excluding the pandemic, the unemployment rate for graduates ages 22 to 27 is the highest it's been in 12 years. While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia. Zahid, 25, completed her studies in December, but so far she hasn't found a job in the industry that surrounds her. "It stings a little bit," she said. "I never imagined it would be this difficult just to get a foot in the door." Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the coronavirus pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in more than three decades. The rise in unemployment has worried many economists as well as officials at the Federal Reserve because it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration's tariff increases, which could slow growth. "Young people are bearing the brunt of a lot of economic uncertainty," Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions." The growth of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. Higher unemployment for younger graduates has also renewed concerns about the value of a college degree. More workers than ever have a four-year degree, which makes it less of a distinguishing factor in job applications. Murat Tasci, an economist at JPMorgan, calculates that 45% of workers have a four-year degree, up from 26% in 1992. While the difficulty of finding work has demoralized young people like Zahid, most economists argue that holding a college degree still offers clear lifetime benefits. Graduates earn higher pay and experience much less unemployment over their lifetimes. The overall U.S. unemployment rate is a still-low 4.2%, and the government's monthly jobs reports show the economy is generating modest job gains. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads, such as information technology, legal services, and accounting have languished in the past 12 months. The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate -- new hires as a percentage of all jobs -- has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March -- the highest, excluding the pandemic, since 2012, and far above the nationwide rate. Lexie Lindo, 23, saw how reluctant companies were to hire while applying for more than 100 jobs last summer and fall after graduating from Clark Atlanta University with a business degree and 3.8 GPA. She had several summer internships in fields such as logistics and real estate while getting her degree, but no offer came. "Nobody was taking interviews or responding back to any applications that I filled out," Lindo, who is from Auburn, Georgia, said. "My résumé is full, there's no gaps or anything. Every summer I'm doing something. It's just, 'OK, so what else are you looking for?'" She has returned to Clark for a master's program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She's hopeful it will lead to a job next year. Artificial intelligence could be a culprit, particularly in IT. Matthew Martin, senior U.S. economist at Oxford Economics, has calculated that employment for college graduates 28 and above in computer science and mathematical occupations has increased a slight 0.8% since 2022. For those ages 22 to 27, it has fallen 8%, according to Martin. Company announcements have further fueled concerns. Tobi Lutke, CEO of online commerce software company Shopify, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI." Last week, Amazon CEO Andy Jassy said AI would likely reduce the company's corporate work force over the next few years. "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs," Jassy said in a message to employees. "We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company." Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, "Why hire a human when you could use AI?" Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn't, said Kory Kantenga, the firm's head of economics for the Americas. "We don't see any broad-based evidence that AI is having a disproportionate impact in the labor market or even a disproportionate impact on younger workers versus older workers," Kantenga said. He added that the Federal Reserve's interest rate hikes have also slowed hiring in tech. Many IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic. In 2022, the Fed began cranking up rates to combat inflation, which made it harder to borrow and grow. In fact, IT's hiring spree when rates were low -- fueled by millions of Americans ramping up their online shopping and video conferencing -- left many firms with too many workers, economists say. Cory Stahle, an economist at the job-listings website Indeed, says postings for software development jobs, for example, have fallen 40% compared with four years ago. It's a sharp shift for students who began studying computer science when hiring was near its peak. Zahid, who lives in Dublin, California, has experienced this whiplash firsthand. When she entered college in 2019, her father, who is a network engineer, encouraged her to study IT and said it would be easy for her to get a job in the field. She initially studied psychology but decided she wanted something more hands-on and gravitated to data analysis. Her husband, 33, has a software development job, and friends of hers in IT received immediate job offers upon graduation a few years ago. Such rapid hiring seems to have disappeared now, she said. She has her college diploma, but hasn't hung it up yet. "I will put it up when I actually get a job, confirming that it was worth it all," she said.

College graduates face toughest job market in more than a decade as hiring slows

WASHINGTON -- While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia. Zahid, 25, completed her studies in December, but so far she hasn't found a job in the industry that surrounds her. "It stings a little bit," she said. "I never imagined it would be this difficult just to get a foot in the door." Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the coronavirus pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in more than three decades. The rise in unemployment has worried many economists as well as officials at the Federal Reserve because it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration's tariff increases, which could slow growth. "Young people are bearing the brunt of a lot of economic uncertainty," Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions." The growth of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. Higher unemployment for younger graduates has also renewed concerns about the value of a college degree. More workers than ever have a four-year degree, which makes it less of a distinguishing factor in job applications. Murat Tasci, an economist at JPMorgan, calculates that 45% of workers have a four-year degree, up from 26% in 1992. While the difficulty of finding work has demoralized young people like Zahid, most economists argue that holding a college degree still offers clear lifetime benefits. Graduates earn higher pay and experience much less unemployment over their lifetimes. The overall U.S. unemployment rate is a still-low 4.2%, and the government's monthly jobs reports show the economy is generating modest job gains. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads, such as information technology, legal services, and accounting have languished in the past 12 months. The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate -- new hires as a percentage of all jobs -- has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March -- the highest, excluding the pandemic, since 2012, and far above the nationwide rate. Lexie Lindo, 23, saw how reluctant companies were to hire while applying for more than 100 jobs last summer and fall after graduating from Clark Atlanta University with a business degree and 3.8 GPA. She had several summer internships in fields such as logistics and real estate while getting her degree, but no offer came. "Nobody was taking interviews or responding back to any applications that I filled out," Lindo, who is from Auburn, Georgia, said. "My resume is full, there's no gaps or anything. Every summer I'm doing something. It's just, 'OK, so what else are you looking for?'" She has returned to Clark for a master's program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She's hopeful it will lead to a job next year. Artificial intelligence could be a culprit, particularly in IT. Matthew Martin, senior U.S. economist at Oxford Economics, has calculated that employment for college graduates 28 and above in computer science and mathematical occupations has increased a slight 0.8% since 2022. For those ages 22 to 27, it has fallen 8%, according to Martin. Company announcements have further fueled concerns. Tobi Lutke, CEO of online commerce software company Shopify, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI." Last week, Amazon CEO Andy Jassy said AI would likely reduce the company's corporate work force over the next few years. "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs," Jassy said in a message to employees. "We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company." Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, "Why hire a human when you could use AI?" Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn't, said Kory Kantenga, the firm's head of economics for the Americas. "We don't see any broad-based evidence that AI is having a disproportionate impact in the labor market or even a disproportionate impact on younger workers versus older workers," Kantenga said. He added that the Federal Reserve's interest rate hikes have also slowed hiring in tech. Many IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic. In 2022, the Fed began cranking up rates to combat inflation, which made it harder to borrow and grow. In fact, IT's hiring spree when rates were low -- fueled by millions of Americans ramping up their online shopping and video conferencing -- left many firms with too many workers, economists say. Cory Stahle, an economist at the job-listings website Indeed, says postings for software development jobs, for example, have fallen 40% compared with four years ago. It's a sharp shift for students who began studying computer science when hiring was near its peak. Zahid, who lives in Dublin, California, has experienced this whiplash firsthand. When she entered college in 2019, her father, who is a network engineer, encouraged her to study IT and said it would be easy for her to get a job in the field. She initially studied psychology but decided she wanted something more hands-on and gravitated to data analysis. Her husband, 33, has a software development job, and friends of hers in IT received immediate job offers upon graduation a few years ago. Such rapid hiring seems to have disappeared now, she said. She has her college diploma, but hasn't hung it up yet. "I will put it up when I actually get a job, confirming that it was worth it all," she said. ___ AP Writer Matt Sedensky in New York contributed to this report.

College graduates face toughest job market in more than a decade as hiring slows

WASHINGTON (AP) -- While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia. Zahid, 25, completed her studies in December, but so far she hasn't found a job in the industry that surrounds her. "It stings a little bit," she said. "I never imagined it would be this difficult just to get a foot in the door." Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the coronavirus pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in more than three decades. The rise in unemployment has worried many economists as well as officials at the Federal Reserve because it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration's tariff increases, which could slow growth. "Young people are bearing the brunt of a lot of economic uncertainty," Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions." The growth of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. Higher unemployment for younger graduates has also renewed concerns about the value of a college degree. More workers than ever have a four-year degree, which makes it less of a distinguishing factor in job applications. Murat Tasci, an economist at JPMorgan, calculates that 45% of workers have a four-year degree, up from 26% in 1992. While the difficulty of finding work has demoralized young people like Zahid, most economists argue that holding a college degree still offers clear lifetime benefits. Graduates earn higher pay and experience much less unemployment over their lifetimes. The overall U.S. unemployment rate is a still-low 4.2%, and the government's monthly jobs reports show the economy is generating modest job gains. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads, such as information technology, legal services, and accounting have languished in the past 12 months. The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate -- new hires as a percentage of all jobs -- has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March -- the highest, excluding the pandemic, since 2012, and far above the nationwide rate. Lexie Lindo, 23, saw how reluctant companies were to hire while applying for more than 100 jobs last summer and fall after graduating from Clark Atlanta University with a business degree and 3.8 GPA. She had several summer internships in fields such as logistics and real estate while getting her degree, but no offer came. "Nobody was taking interviews or responding back to any applications that I filled out," Lindo, who is from Auburn, Georgia, said. "My resume is full, there's no gaps or anything. Every summer I'm doing something. It's just, 'OK, so what else are you looking for?'" She has returned to Clark for a master's program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She's hopeful it will lead to a job next year. Artificial intelligence could be a culprit, particularly in IT. Matthew Martin, senior U.S. economist at Oxford Economics, has calculated that employment for college graduates 28 and above in computer science and mathematical occupations has increased a slight 0.8% since 2022. For those ages 22 to 27, it has fallen 8%, according to Martin. Company announcements have further fueled concerns. Tobi Lutke, CEO of online commerce software company Shopify, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI." Last week, Amazon CEO Andy Jassy said AI would likely reduce the company's corporate work force over the next few years. "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs," Jassy said in a message to employees. "We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company." Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, "Why hire a human when you could use AI?" Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn't, said Kory Kantenga, the firm's head of economics for the Americas. "We don't see any broad-based evidence that AI is having a disproportionate impact in the labor market or even a disproportionate impact on younger workers versus older workers," Kantenga said. He added that the Federal Reserve's interest rate hikes have also slowed hiring in tech. Many IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic. In 2022, the Fed began cranking up rates to combat inflation, which made it harder to borrow and grow. In fact, IT's hiring spree when rates were low -- fueled by millions of Americans ramping up their online shopping and video conferencing -- left many firms with too many workers, economists say. Cory Stahle, an economist at the job-listings website Indeed, says postings for software development jobs, for example, have fallen 40% compared with four years ago. It's a sharp shift for students who began studying computer science when hiring was near its peak. Zahid, who lives in Dublin, California, has experienced this whiplash firsthand. When she entered college in 2019, her father, who is a network engineer, encouraged her to study IT and said it would be easy for her to get a job in the field. She initially studied psychology but decided she wanted something more hands-on and gravitated to data analysis. Her husband, 33, has a software development job, and friends of hers in IT received immediate job offers upon graduation a few years ago. Such rapid hiring seems to have disappeared now, she said. She has her college diploma, but hasn't hung it up yet. "I will put it up when I actually get a job, confirming that it was worth it all," she said. ___ AP Writer Matt Sedensky in New York contributed to this report.

College Graduates Face Toughest Job Market in More Than a Decade as Hiring Slows

WASHINGTON (AP) -- While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia. Zahid, 25, completed her studies in December, but so far she hasn't found a job in the industry that surrounds her. "It stings a little bit," she said. "I never imagined it would be this difficult just to get a foot in the door." Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the coronavirus pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in more than three decades. The rise in unemployment has worried many economists as well as officials at the Federal Reserve because it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration's tariff increases, which could slow growth. "Young people are bearing the brunt of a lot of economic uncertainty," Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions." The growth of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. Higher unemployment for younger graduates has also renewed concerns about the value of a college degree. More workers than ever have a four-year degree, which makes it less of a distinguishing factor in job applications. Murat Tasci, an economist at JPMorgan, calculates that 45% of workers have a four-year degree, up from 26% in 1992. While the difficulty of finding work has demoralized young people like Zahid, most economists argue that holding a college degree still offers clear lifetime benefits. Graduates earn higher pay and experience much less unemployment over their lifetimes. The overall U.S. unemployment rate is a still-low 4.2%, and the government's monthly jobs reports show the economy is generating modest job gains. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads, such as information technology, legal services, and accounting have languished in the past 12 months. The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate -- new hires as a percentage of all jobs -- has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March -- the highest, excluding the pandemic, since 2012, and far above the nationwide rate. Lexie Lindo, 23, saw how reluctant companies were to hire while applying for more than 100 jobs last summer and fall after graduating from Clark Atlanta University with a business degree and 3.8 GPA. She had several summer internships in fields such as logistics and real estate while getting her degree, but no offer came. "Nobody was taking interviews or responding back to any applications that I filled out," Lindo, who is from Auburn, Georgia, said. "My resume is full, there's no gaps or anything. Every summer I'm doing something. It's just, 'OK, so what else are you looking for?'" She has returned to Clark for a master's program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She's hopeful it will lead to a job next year. Artificial intelligence could be a culprit, particularly in IT. Matthew Martin, senior U.S. economist at Oxford Economics, has calculated that employment for college graduates 28 and above in computer science and mathematical occupations has increased a slight 0.8% since 2022. For those ages 22 to 27, it has fallen 8%, according to Martin. Company announcements have further fueled concerns. Tobi Lutke, CEO of online commerce software company Shopify, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI." Last week, Amazon CEO Andy Jassy said AI would likely reduce the company's corporate work force over the next few years. "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs," Jassy said in a message to employees. "We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company." Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, "Why hire a human when you could use AI?" Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn't, said Kory Kantenga, the firm's head of economics for the Americas. "We don't see any broad-based evidence that AI is having a disproportionate impact in the labor market or even a disproportionate impact on younger workers versus older workers," Kantenga said. He added that the Federal Reserve's interest rate hikes have also slowed hiring in tech. Many IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic. In 2022, the Fed began cranking up rates to combat inflation, which made it harder to borrow and grow. In fact, IT's hiring spree when rates were low -- fueled by millions of Americans ramping up their online shopping and video conferencing -- left many firms with too many workers, economists say. Cory Stahle, an economist at the job-listings website Indeed, says postings for software development jobs, for example, have fallen 40% compared with four years ago. It's a sharp shift for students who began studying computer science when hiring was near its peak. Zahid, who lives in Dublin, California, has experienced this whiplash firsthand. When she entered college in 2019, her father, who is a network engineer, encouraged her to study IT and said it would be easy for her to get a job in the field. She initially studied psychology but decided she wanted something more hands-on and gravitated to data analysis. Her husband, 33, has a software development job, and friends of hers in IT received immediate job offers upon graduation a few years ago. Such rapid hiring seems to have disappeared now, she said. She has her college diploma, but hasn't hung it up yet. "I will put it up when I actually get a job, confirming that it was worth it all," she said. ___ AP Writer Matt Sedensky in New York contributed to this report. Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

After Canada, now US: College graduates face the toughest job market in decades - what's gone wrong?

Recent college graduates are facing a challenging job market, with unemployment rates among young degree holders reaching a decade high. Economic uncertainty, AI disruption, and a surplus of graduates contribute to hiring freezes, particularly in tech and finance. While some sectors like healthcare and government are growing, traditional degree-heavy fields are experiencing a slowdown.When Palwasha Zahid moved from Dallas to a town near Silicon Valley, she felt like she was stepping into the heart of opportunity, with major tech companies like Google, Apple, and Nvidia just a short drive away, while she was pursuing her master's degree in data analysis, she imagined her career taking off, as per a report. Instead, even after months since graduating in December, the 25-year-old is still unemployed as she is unable to find a job in the industry she specialised in, according to an AP report. Zahid told AP, "It stings a little bit," adding "I never imagined it would be this difficult just to get a foot in the door," as quoted in the report. But Zahid is not alone, because young Americans graduating from college this spring and summer are entering one of the most difficult times of the job market in over a decade, as reported by AP. According to the report, among college degree holders aged between 22 to 27, the unemployment rate hit 5.8% in March, which is the highest since 2012, it's been apart from the pandemic year, and noticeably higher than the national unemployment rate of 4.2%, as per the AP report. What's even more concerning is that this gap between young graduates and the rest of the workforce is larger than it has been in more than three decades, as reported by AP. ALSO READ: Karoline Leavitt says no enriched uranium was removed from Iranian nuclear sites prior to US attacks Economists and policy experts are pointing to many factors, like business hesitation due to economic uncertainty, especially after US President Donald Trump's tariff hikes, which are weighing heavily on new hiring, according to the report. Companies are cautious, and that's bad news for those just starting out, as per the report. Senior economist at the Upjohn Institute, Brad Hersbein, said, "Young people are bearing the brunt of a lot of economic uncertainty," adding, "The people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions," quoted AP in its report. Another possible factor is artificial intelligence. While still in its early phases of adoption, some believe AI is already squeezing entry-level white-collar roles, particularly in industries like tech, finance, and legal services, as reported by AP. CEO of online commerce software company Shopify, Tobi Lutke, said in an April memo that before requesting new hires, "teams must demonstrate why they cannot get what they want done using AI," as quoted by AP. ALSO READ: Last chance to claim your Fortnite refund - Act fast or risk missing out on free cash Part of the difficulty stems from the sheer number of graduates as more Americans than ever now hold a four-year degree, which is 45% today compared to just 26% in 1992, making it less of a standout in the job market, according to the report. Despite these challenges, economists still say college degrees provide long-term benefits, including better lifetime earnings and lower unemployment overall, as per AP report. While job growth continues, much of it is concentrated in sectors like health care, government, and hospitality, not exactly what many degree holders trained for, according to the report. In traditionally degree-heavy fields like IT, legal services, and accounting, job growth has slowed significantly. Cory Stahle, an economist at the job-listings website Indeed, revealed that postings for software development jobs have fallen 40% compared with four years ago, reported AP. ALSO READ: Rocket Lab stock skyrockets past 52-week high with 13% surge - what's fueling the rise? Although layoffs remain rare, hiring has slowed to levels last seen in 2014, when unemployment was much higher, as per the report. Economists have dubbed it a "no-hire, no-fire" economy, which is stable, but stagnant, particularly for those trying to start their career, according to the report. While LinkedIn's head of economics for the Americas, Kory Kantenga, pointed out that the Federal Reserve's interest rate hikes have also slowed hiring in the tech industry because many IT firms expanded when the Fed lowered its short-term rate to nearly zero after the pandemic, as reported by AP. But in 2022, when the Fed began increasing rates to combat inflation, it made it harder to borrow and grow, as per the report. What fields are still hiring graduates? Health care, hospitality, and government jobs are seeing growth. Sectors like IT and legal services have slowed down. Is AI really taking away jobs already? It's starting to have an effect, especially in entry-level white-collar roles. Some companies now ask whether AI can do the job before hiring a person.