What is the job market like for new college graduates?

A Vox reader Nneoma Ngene asks: Maybe it’s because I am a new grad, graduating with my bachelor’s in May yippee! But it seems everyone is super pessimistic about the job market these days. Has it been harder to get a job for people in recent years, or am I just finally shedding my childhood naïveté and being forced to wake up to the way the job market has always been?

Congratulations on your graduation! That’s a genuine achievement worth celebrating, even amid job market concerns.

The short answer to your question is that, unfortunately, the economic data does confirm what you’re sensing: The job market really is more challenging for new graduates right now, and it’s not just your childhood optimism fading away.

You and your peers have faced uniquely tough circumstances. You started college during a pandemic, and now you’re entering a job market that’s shifting beneath your feet in ways that can feel discouraging, even though they’re driven by much larger economic and technological forces.

This isn’t the first time graduates have faced a difficult transition. The Great Recession in 2008 led to hiring freezes and layoffs that blocked new workers from landing entry-level jobs. The labor market took time to heal after unemployment peaked in 2009, but improved steadily until the pandemic disrupted that progress.

What new grads are facing

Numbers from the first quarter of 2025 from the New York Federal Reserve show that the unemployment rate for recent college graduates reached 5.8 percent, up from 4.8 percent in January.

Companies have also pulled back on hiring. Last fall, employers expected to increase college-graduate hiring by 7.3 percent, according to a survey led by the National Association of Colleges and Employers. Now they’re projecting just a 0.6 percent increase, with about 11 percent of companies planning to hire fewer new grads than before.

A few different factors are working together to create this challenging environment.

First, the new tariffs have created economic uncertainty. The stock market responded accordingly, with the S&P 500 down about 6.5 percent since inauguration day as of this writing. As a result, businesses are hesitant to expand their workforce.

The elephant in the room here — that Great Recession grads didn’t have to deal with — is artificial intelligence. There’s evidence that AI might be affecting entry-level opportunities. The tasks typically performed by new college graduates — synthesizing information, producing reports — align with what generative AI can now generally handle.

And while the unemployment rate for recent grads is 5.8 percent, the overall unemployment rate is 4.2 percent — a record gap. This suggests that while companies are not laying workers off because of AI en masse, they may be using AI to do jobs that would otherwise have gone to new grads.

It’s understandably frustrating when you’ve done everything “right” — earned your degree and prepared for the job market — only to face conditions that are more challenging than in recent years.

The good news about the job market

Despite these challenges, some sectors are still actively hiring.

Health care accounts for 34 percent of total payroll gains this year. Engineering positions, especially electronics engineering, offer opportunities with high starting salaries (projected at $78,731). Special education roles are abundant, and while federal hiring has contracted, state and local governments remain strong for entry-level hiring. Sales consistently ranks among the top fields for new college graduates.

On the tariffs front, the situation seems to be turning a corner now, as stock markets digest news of President Donald Trump’s recent deal with China. This deal could help prevent a full recession and improve the outlet for college-graduate hiring.

The reality is that your job search might take longer than you hoped. Over 80 percent of seniors told ZipRecruiter in March that they expect to start working within three months of graduating, but in reality, only about 77 percent from recent graduating classes started that quickly. If it takes even longer for you or your peers, that’s not a personal failure — it’s simply a reflection of the market you’re entering.

Your question asked whether this is just “the way the job market has always been.” The truth is that job markets fluctuate, and the timing of your graduation coincides with a particularly challenging period. But previous generations have faced similar challenges and found their way through, and yours will too.

This story was originally published in The Highlight, Vox’s member-exclusive magazine. To get early access to member-exclusive stories every month, join the Vox Membership program today.