College Grads Find the Current Job Market 'Stings'

While completing a master's degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley. 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, per the AP. The unemployment rate for degree holders ages 22 to 27 has reached its highest level in a dozen years, excluding the pandemic. Joblessness among that group is now higher than the overall unemployment rate, and the gap is larger than it has been in over three decades.

The rise in unemployment has worried many economists, as well as officials at the Federal Reserve, as it could be an early sign of trouble for the economy. It suggests businesses are holding off on hiring new workers due to 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," says Brad Hershbein, senior economist at the Upjohn Institute. "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.

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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 US 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. More here.