A growing number of recent graduates across the United States are struggling to find full-time roles in their chosen fields, raising fresh concerns about the economic future of Generation Z. Despite earning degrees, developing specialised skills and entering the labour force with high aspirations, many young job seekers say the market has become increasingly discouraging and unpredictable

A generation prepared but left waiting

For 23-year-old Ashley Terrell, the dream was clear: earn her business degree, secure a marketing role and begin a stable career. Instead, more than a year after graduating from the University of Hawaii at Manoa, she is still searching.

“It is something I have to motivate myself every day to wake up and do,” she says, reflecting on the long months of applications, networking attempts and interviews that led to only one initial offer — a retail-focused job promoting power tools. The role did not align with her training, and her subsequent position at a hotel was cut short when she was laid off in September 2025.

Terrell’s experience mirrors a national pattern: just 30% of 2025 graduates reported securing full-time employment in their field, according to a Cengage Group survey.

Why the job market feels particularly tough

A slowdown in hiring is shaping the landscape for early-career entrants. According to Cengage, 76% of employers hired the same number or fewer entry-level employees in 2025 compared with the previous year. This shift is driven by:

  • Over-hiring during the post-pandemic boom, leaving companies with little room for new roles.
  • Economic pressures including inflation and tariff policies.
  • AI integration, as firms pause to evaluate how technology can complement or delay human hiring.

Nich Tremper, senior economist at Gusto, notes that many workers hired in 2021–22 have stayed put, freezing movement within companies. “Without those new jobs available, it’s hard for an entry-level employee to get their foot in the door,” he says.

This stagnation is widening. Between January and October 2025, companies announced 1.1 million job cuts, the highest levels since the pandemic.

Unemployment rates converge for degree-holders and non-graduates

Federal Reserve data shows that unemployment among recent graduates rose to 9.7% in September 2025, equal to rates seen among young people with only a high school diploma. Traditionally, university graduates have enjoyed a buffer against unemployment — but that gap has narrowed sharply.

Tremper adds that early-career joblessness has long-term consequences: limited salary growth, fewer promotion opportunities and reduced lifetime earning potential.

AI complicates the job search

While AI is not replacing workers wholesale, its expanding presence is reshaping entry-level hiring. Many companies are using AI tools for tasks such as content drafting, data sorting and customer communication — historically roles filled by new graduates.

Terrell says she has seen a noticeable decline in job listings aligned with her skills. “I feel like AI is taking away some of those jobs,” she says.

Several of her peers have shifted course entirely. Some have taken up service roles unrelated to their degrees; others have opted for trade schools.

A growing shift toward skilled trades

One young professional who changed paths is Chris Henderson, who graduated with a business management degree in 2022. Facing a lack of opportunities in corporate finance, he joined his family’s electrician business and later completed two years of trade training.

Henderson now earns about $72,000 a year, a salary higher than many entry-level graduates in white-collar roles. He finds the work fulfilling and plans to apply his business degree to manage or eventually expand the family firm.

His experience reflects wider labour trends: electrician roles, construction work, nursing, home health care and software development are projected by the Bureau of Labor Statistics to be among the fastest-growing fields over the next decade.

Is college still “worth it”? Graduates say yes — with caveats

Despite hardships, both Terrell and Henderson say their degrees gave them valuable skills, independence and clarity about their long-term goals.

“The biggest way it paid off for me was growing more independent and getting some life skills,” Terrell says. She remains hopeful that networking and referrals will eventually open the right door, even as many of her classmates remain unemployed.

“It kind of feels like we’re all in the same boat,” she says. “How can we help each other when none of us are really thriving?”

Economists warn that the stagnation could have long-term consequences. As Tremper notes, the next 10–20 years may become increasingly challenging if today’s graduates are unable to accumulate the skills and experience necessary for sustained career growth.