For the class of 2025, graduation should mark the beginning of exciting career opportunities. Instead, many new grads are facing a difficult reality: the job market is not welcoming them with open arms. While the overall U.S. unemployment rate remains relatively steady, recent college graduates are experiencing some of the highest jobless rates seen in a decade, excluding the pandemic-era spike.
A Market That’s Holding Steady, But Not for Everyone
According to data from the U.S. Labor Department, the unemployment rate for college graduates ages 20 to 24 averaged 6.6% over the past 12 months ending in May. That’s noticeably higher than the 4% national average and a sharp increase from 6% just one year prior. For comparison, the unemployment rate for older adults ages 35 to 44 with a bachelor's degree sits at just 2.2%.
While the labor market overall appears stable, the dynamics shift when looking at job seekers, particularly those new to the workforce. Most layoffs have remained low, so people already employed are staying put. But businesses have pulled back on new hiring, making it significantly harder for job seekers, especially entry-level candidates without prior experience.
The Experience Dilemma
This hiring slowdown means companies are being more selective. Many recent grads report encountering an all-too-common obstacle: “entry-level” jobs requiring three to five years of experience. It’s a frustrating paradox. Without opportunities, they can’t gain experience, but without experience, they’re not getting the opportunities.
Kirby Child, a recent health communications graduate, shared that even applying for basic roles often results in rejection due to lack of professional experience. Her friend, Zara Anwar, landed a job in data analytics, only to have her start date delayed multiple times.
Fewer Openings, More Competition
The Federal Reserve Bank of New York noted that labor conditions for new college grads “deteriorated noticeably” in the first quarter of the year. The gap between young graduate unemployment and the broader workforce is now the widest it has been in more than 35 years.
Entry-level hiring has dropped 17% since April 2019, according to LinkedIn. Fields like healthcare and construction have seen some gains, but traditional landing spots for recent grads such as finance, tech, and marketing have scaled back significantly. Add to that the growing influence of automation and AI, and the competition for entry-level work becomes even stiffer.
Delayed Starts and Vanishing Openings
Even for grads who receive offers, uncertainty continues. Some report delayed start dates, while others hear nothing back at all after dozens or even hundreds of applications. Many employers are simply waiting to see how the economy evolves before committing to new hires.
This hiring hesitation is not limited to college graduates. High school grads have it even tougher, with an average unemployment rate of 14.5% for 18- to 19-year-olds with no college degree, up from 13.3% the year before. For younger job seekers, even seasonal or part-time work is hard to come by.
The Emotional Toll
Recent graduates describe feeling stuck and disheartened. Some have put their job searches on pause, opted to travel, or returned to their parents’ homes as they regroup and reevaluate their plans.
What was once considered a rite of passage, getting your foot in the door after graduation, now feels more like an uphill climb. For many, the degree was supposed to be the key to opportunity. Right now, it just doesn’t feel that way.
Looking Ahead
The challenges facing this year’s graduates highlight a broader issue in the labor market: a disconnect between employers’ expectations and job seekers’ realities. As businesses navigate uncertainty and students adjust their expectations, the need for early career support, internships, and employer flexibility has never been greater.
For new grads, persistence and creativity are key. And for employers, investing in young talent today may be the smartest long-term move they can make.