{"id":17170,"date":"2025-06-26T20:14:09","date_gmt":"2025-06-26T20:14:09","guid":{"rendered":"https:\/\/www.europesays.com\/us\/17170\/"},"modified":"2025-06-26T20:14:09","modified_gmt":"2025-06-26T20:14:09","slug":"the-unemployment-rate-for-young-college-graduates-worries-many-economists","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/17170\/","title":{"rendered":"The unemployment rate for young college graduates worries many economists"},"content":{"rendered":"

WASHINGTON (AP) \u2014 While completing a master\u2019s degree in data analysis, Palwasha Zahid moved from Dallas to a town near Silicon Valley<\/a>. The location made it easy to visit the campuses of tech stalwarts such as Google, Apple, and Nvidia<\/a>. <\/p>\n

Zahid, 25, completed her studies in December, but so far she hasn\u2019t found a job in the industry<\/a> that surrounds her. <\/p>\n

\u201cIt stings a little bit,\u201d she said. \u201cI never imagined it would be this difficult just to get a foot in the door.\u201d<\/p>\n

Young people graduating from college this spring<\/a> 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<\/a> 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. <\/p>\n

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<\/a> because of rampant uncertainty stemming from the Trump administration\u2019s tariff increases, which could slow growth.<\/p>\n

\u201cYoung people are bearing the brunt of a lot of economic uncertainty,\u201d Brad Hersbein, senior economist at the Upjohn Institute, a labor-focused think tank, said. \u201cThe people that you often are most hesitant in hiring when economic conditions are uncertain are entry-level positions.\u201d<\/p>\n

The growth of artificial intelligence<\/a> may be playing an additional role by eating away at positions for beginners in white-collar professions such as information technology, finance, and law. <\/p>\n

Higher unemployment for younger graduates has also renewed concerns about the value of a college degree<\/a>. 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. <\/p>\n

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<\/a>. Graduates earn higher pay and experience much less unemployment over their lifetimes. <\/p>\n

The overall U.S. unemployment rate is a still-low 4.2%, and the government\u2019s monthly jobs reports show the economy is generating modest job gains<\/a>. But the additional jobs are concentrated in health care, government, and restaurants and hotels. Job gains in professions with more college grads<\/a>, such as information technology, legal services, and accounting have languished in the past 12 months. <\/p>\n

The unemployment rate has stayed low mostly because layoffs are still relatively rare. The actual hiring rate \u2014 new hires as a percentage of all jobs \u2014 has fallen to 2014 levels, when the unemployment rate was much higher, at 6.2%. Economists call it a no-hire, no-fire economy. <\/p>\n

For college graduates 22 to 27 years old, the unemployment rate was 5.8% in March<\/a> \u2014 the highest, excluding the pandemic, since 2012, and far above the nationwide rate. <\/p>\n

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. <\/p>\n

\u201cNobody was taking interviews or responding back to any applications that I filled out,\u201d Lindo, who is from Auburn, Georgia, said. \u201cMy resume is full, there\u2019s no gaps or anything. Every summer I\u2019m doing something. It\u2019s just, \u2018OK, so what else are you looking for?\u2019\u201d<\/p>\n

She has returned to Clark for a master\u2019s program in supply chain studies and has an internship this summer at a Fortune 500 company in Austin, Texas. She\u2019s hopeful it will lead to a job next year.<\/p>\n

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. <\/p>\n

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, \u201cteams must demonstrate why they cannot get what they want done using AI.\u201d<\/p>\n

Last week, Amazon CEO Andy Jassy said AI would likely reduce the company\u2019s corporate workforce<\/a> over the next few years. <\/p>\n

\u201cWe will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs,\u201d Jassy said in a message to employees. \u201cWe expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company.\u201d<\/p>\n

Zahid worries that AI is hurting her chances. She remembers seeing big billboard ads for AI at the San Francisco airport that asked, \u201cWhy hire a human when you could use AI?\u201d <\/p>\n

Still, many economists argue that blaming AI is premature. Most companies are in the early stages of adopting the technology. <\/p>\n

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\u2019t, said Kory Kantenga, the firm\u2019s head of economics for the Americas. <\/p>\n

\u201cWe don\u2019t 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,\u201d Kantenga said. <\/p>\n

He added that the Federal Reserve\u2019s 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. <\/p>\n

In fact, IT\u2019s hiring spree when rates were low \u2014 fueled by millions of Americans ramping up their online shopping and video conferencing \u2014 left many firms with too many workers, economists say. <\/p>\n

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\u2019s a sharp shift for students who began studying computer science when hiring was near its peak.<\/p>\n

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. <\/p>\n

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. <\/p>\n

She has her college diploma, but hasn\u2019t hung it up yet. <\/p>\n

\u201cI will put it up when I actually get a job, confirming that it was worth it all,\u201d she said. <\/p>\n

___ <\/p>\n

AP Writer Matt Sedensky in New York contributed to this report. <\/p>\n","protected":false},"excerpt":{"rendered":"WASHINGTON (AP) \u2014 While completing a master\u2019s degree in data analysis, Palwasha Zahid moved from Dallas to a…\n","protected":false},"author":3,"featured_media":17171,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[7060,6229,16718,239,738,359,16723,64,16720,7824,16722,1596,2239,12042,79,407,16721,455,57,86,59,65,63,16209,16727,606,16725,16726,147,16719,16728,358,16724,61,67,370,132,68],"class_list":{"0":"post-17170","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-alphabet","9":"tag-amazon-com","10":"tag-andrew-jassy","11":"tag-apple","12":"tag-artificial-intelligence","13":"tag-austin","14":"tag-brad-hersbein","15":"tag-business","16":"tag-colleges-and-universities","17":"tag-coronavirus","18":"tag-cory-stahle","19":"tag-dallas","20":"tag-economic-indicators","21":"tag-economic-policy","22":"tag-economy","23":"tag-education","24":"tag-engineering","25":"tag-federal-reserve-system","26":"tag-general-news","27":"tag-government-policy","28":"tag-inc","29":"tag-information-technology","30":"tag-jobs-and-careers","31":"tag-jpmorgan-chase-co","32":"tag-kory-kantenga","33":"tag-labor","34":"tag-lexie-lindo","35":"tag-matthew-martin","36":"tag-nvidia-corp","37":"tag-oxford","38":"tag-pandemics","39":"tag-texas","40":"tag-tobi-lutke","41":"tag-u-s-news","42":"tag-united-states","43":"tag-united-states-government","44":"tag-unitedstates","45":"tag-us"},"share_on_mastodon":{"url":"","error":"Validation failed: Text character limit of 500 exceeded"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/17170","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=17170"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/17170\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/17171"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=17170"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=17170"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=17170"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}