Recent Grads Face a Tough Employment Market

This year’s college graduates are entering a tougher job market than last year’s. The Federal Reserve reports that the unemployment rate for recent grads was 5.8% as of March, up from 4.6% a year ago. The share of new graduates working jobs that don’t require their degrees — a situation known as “underemployment” — hit 41.2% in March, rising from 40.6% that same month in 2024. Although young grads have lower unemployment rates than the broader labor market, The Atlantic points out that this gap has narrowed to a record low, making some newly minted grads question the benefits of a bachelor’s degree.

Anxiety around landing a first full-time job is common, but fresh grads have real reasons to be pessimistic this year. Employers are hiring fewer entry-level new graduates. The National Association of Colleges and Employers, which polled major companies including Chevron, PepsiCo, and Southwest Airlines, reveals that the share of respondents planning to expand entry-level hiring dipped to 24.6% this spring, the lowest since the third quarter of 2020. The environment is even rougher for people without degrees. High-school graduates aged 18 to 19 with no college averaged an unemployment rate of 14.5% over the past 12 months. That is up from 13.3% over the prior 12-month period. 

The STEM supremacy is beginning to show some cracks as well. In the wake of the broad-scale push for students to pursue degrees in STEM, that market is now oversaturated, in addition to companies’ use of AI to do formerly entry-level tasks. STEM degrees such as physics, computer engineering, and chemistry are increasingly leaving recent graduates, those aged 22 to 27, without jobs. Data from the NY Fed show that national unemployment rates for many of those degrees are far worse than the average unemployment rate for all recent grads — as well as the unemployment rate for all young workers, regardless of education.

The overall lack of entry-level jobs is one problem. The expectations for entry-level jobs that do exist is quite another. Employers are requiring unrealistic professional experience for entry-level positions, making it difficult for recent graduates to compete in the job market. If you search for “entry-level” jobs on LinkedIn, you’ll see job listings requiring three to five or more years of relevant experience. Absurd. 

How can recent graduates gain work experience amid a dearth of entry-level jobs and entry-level jobs that require years of experience? 

Securing internships in their field of study or interest can provide valuable hands-on experience. It is not uncommon for recent graduates to do post-graduate internships these days. 

Engaging in volunteer work allows for the development of skills, expands professional networks, and provides practical experience that can enhance a résumé.

Taking on part-time roles can help recent graduates develop transferable skills, such as communication, teamwork, and problem-solving.

Pursuing freelance projects can help build a portfolio and gain practical experience.

If you are struggling to find your first job, you may also need to manage your expectations. I recently worked with a young client who wanted to work in the nonprofit world (Nonprofit jobs are notoriously difficult to secure!). I advised her that she broaden her search to include other industries and different types of jobs. Having a narrow focus is important later in your career, but if you are in your nascent years, the most important thing is to get professional experience on your résumé. If you’re still finding it difficult to land a role, you may want to consider seeking the advice of a professional career counselor. If you’re going to do this, please do your research. Anyone can call themselves a career counselor; the field is rife with fraud. Lastly, I do not advise going to grad or law school as a default. Graduate degrees are expensive and time-consuming, and enrolling in a program should be for reasons other than it being the only option you see. 

While the job market may be challenging, recent graduates are not powerless. By staying flexible, taking initiative, and building experience through nontraditional paths, you can lay the groundwork for a meaningful and sustainable career.