Despite a generally healthy U.S. job market, the Class of 2025 is confronting the most difficult hiring landscape for college graduates since the height of the COVID-19 pandemic. While the national unemployment rate holds at 4.2% and job growth has continued for over four straight years, new graduates are struggling to find their first jobs. Economists say this group is disproportionately affected by today’s “no-hire, no-fire” employment climate, where companies are hesitant to add or cut staff amid economic uncertainty.
For the first time since 1980, recent college graduates (ages 22–27 with a bachelor’s degree or higher) face a consistently higher unemployment rate than the national average, according to Oxford Economics. Entry-level hiring is down 23% compared to March 2020, exceeding the overall hiring decline of 18%.
Young Men and Gen Z Hit Hard
Unemployment among younger adults is climbing fast. The jobless rate for those aged 20–24 is 8.2%, nearly double the national average. For young men in particular, it has jumped to 9.6%, up from 6.7% a year ago. Worker confidence among Gen Z has fallen to its lowest point on record, even lower than during the pandemic’s early months, LinkedIn reports.
Many employers, after aggressively hiring in 2021 and 2022, are now acting cautiously due to trade wars and high interest rates. As of mid-May, unemployment claims hit a four-year high, a sign that job seekers are taking longer to find work.
Jenna Macksoud, 23, applied to five to ten jobs a day after graduating in 2023 but received few responses. “It felt hopeless,” she said. Her persistence eventually led to a job in business development at a cybersecurity firm. Her advice to grads: “It’s a numbers game… You have to be persistent.”
Is AI Eliminating Entry-Level Jobs?
Artificial intelligence is another looming threat. Dario Amodei, CEO of AI firm Anthropic, warned AI could erase half of all entry-level white-collar jobs within five years, potentially pushing unemployment to 10%–20%. He described the current moment as “eerie,” saying both the public and lawmakers are dangerously unaware of AI’s disruptive potential.
Oxford Economics reports an 8% drop in employment for 22–27-year-olds in fields like computer science and mathematics since 2022—sectors especially vulnerable to AI automation. Older professionals in these industries, by contrast, have seen little change.
Still, not everyone believes AI is to blame. LinkedIn’s chief economist Kory Kantenga points out that fears of tech replacing workers are nothing new. “When ATMs came out, people thought bank tellers would disappear,” he said. “But they adapted.”
The Rising Cost—and Question—of a College Degree
The bleak job outlook also revives questions about the value of a college education. With some degrees costing hundreds of thousands of dollars, many grads are burdened with overwhelming student debt and limited job prospects.
Though unemployment remains lower for those with a degree than without, the gap has narrowed. Kantenga argues that degrees still offer long-term benefits: “The rewards of having a degree still dwarf the costs.” But he cautions that students must choose their focus wisely, aiming for growing sectors like healthcare or education rather than fading ones.
Families and Grads Left in Limbo
The employment crisis is not only affecting graduates but their families as well. Rob Bastress, whose son graduated in December 2023 from UC Irvine, expressed his frustration. “You push your kids to get into good schools and now the opportunities have vanished,” he said.
Gabriel Nash, 24, has applied to over 450 jobs since graduating in 2024 but remains unemployed. He works part-time making gaming content on YouTube, which helps pay some bills—but not enough to move out. “It’s stressful,” Nash admitted. “There’s this pressure to get a job. But if no one’s hiring, what am I supposed to do?”