AI puts the squeeze on new grads looking for work
A college degree is often seen as the ticket to a well-paying career, and more than three million new graduates enter the workforce each year relying on that promise.
But this year, those with a newly minted degree faced one of the toughest job markets in the last decade. It could be just as bad or worse next year.
As the AI boom reshapes the workforce at an unprecedented pace, some large employers have said they will replace workers with AI to streamline operations and reduce costs. Other research shows that concerns about the economy, persistent inflation and a slowdown in consumer spending are also likely contributing to the diminished hiring outlook.
Employers are less optimistic about the overall job market for recent graduates than they have been in the past few years, according to a survey. new report By the National Association of Colleges and Employers. Nearly half, or 51%, of employers rated this year’s job market for college seniors as weak or fair; This is the highest share since 2020-21.
The integration of artificial intelligence has “rendered moot certain types of skills that were once relevant in the labor market, and a number of entry-level jobs, at the very least, will continue to be constrained,” said Joseph Fuller, professor of management practices at Harvard Business School.
That puts direct pressure on colleges and their career services departments, he said. “Paths into certain careers will be narrower and the burden of references will be steeper.”
According to workforce research firm Revelio Labs, entry-level job openings in the US have decreased by 35 percent since January 2023, and artificial intelligence has a big role to play.
As a result, there are suddenly fewer white-collar positions for people starting out with a bachelor’s degree.
A worsening job market for new graduates
Some sectors are more prone to disruption than others. Jobs in technology and finance, for example, are at greater risk from generative AI, which can largely replace human analytical skills, according to a separate report. report By really. Alternatively, nursing and blue-collar jobs in manufacturing or construction are more isolated, the report found. These cannot be done by AI; at least for now.
Last data Research from the Federal Reserve Bank of Philadelphia also shows that high-paying jobs that require a bachelor’s degree are more likely to be impacted by AI.
Although the Class of 2025 applied for more jobs than their 2024 counterparts, they received fewer job offers on average than the previous class. National Association of Colleges and Employers to create.
Only 30% of 2025 college graduates found a full-time job in their field. That’s lower than the 41% of the Class of 2024 who secured full-time employment, according to a separate report. graduate employability report By Cengage Group, an education technology company.
University careers offices are under pressure
At Gettysburg College in Pennsylvania, some employers who have attended the job and internship fair in the past did not attend this year — but did not specify why, according to James Duffy, Gettysburg’s vice president for extracurricular education.
But as companies restructure because of AI, many are cutting back on entry-level jobs that make up a significant portion of employment opportunities for new graduates, Duffy said.
“If we look at the jobs that AI is adopting, there are a lot of jobs that students used to gravitate toward. Some of those jobs no longer exist,” he said.
The proliferation of new technology is putting huge pressure on universities to reorganize at a time when higher education as a whole is already facing a crisis of trust.
Amid rising college costs and ballooning As student loan balances increase, more students are questioning the return on investment.
77 percent of those with student loan debt call it a “huge burden,” and 63 percent say their education is not worth the impact student loan debt has on their overall well-being. EdAssist from Bright Horizons.
Universities say the worst-case scenario is to graduate with debt and no job.
Duffy, who oversees Gettysburg’s career engagement center, said parents of both current and potential students are more concerned than before about potential job opportunities after graduation. “Parents want to know more data and details about where students are going,” he said. “Parents want to know: ‘If I’m going to spend this money, where are they going to go in four years?’ “We know this is the most important issue.”
To that end, Duffy said it’s increasingly important to provide students with as much career-ready experience as possible, primarily through internships, experiences and hands-on work: “That makes them more marketable, and that gives them choice.”
Indeed, Harvard’s Fuller said, “more schools will need to develop cooperative-type opportunities.”
But over time, smaller private colleges like Gettysburg could become disadvantaged compared to urban institutions that are more closely affiliated with large employers, Fuller added: “It would be beneficial to be at a school that has a fair amount of employment opportunities locally.”
‘It is not enough for students to graduate with a diploma’
In July, the City University of New York launched a study. comprehensive effort Improving career outcomes for 180,000 undergraduates by integrating career-related advising, paid internships, apprenticeships, and collaborations with industry experts at every academic concentration.
“Success depends on our ability to change and adapt,” CUNY Chancellor Félix Matos Rodríguez said in a statement about the announcement. “It’s not enough for students to graduate with a degree…they need to leave with direction, preparation, experience and connections.”
Baruch College graduates attend the commencement ceremony held at Barclays Center on June 5, 2017 in Brooklyn, New York.
Bebeto Matthews | access point
CUNY’s goal is for all future graduates to either enroll in a graduate program or “get a job offer in the field they studied,” Matos Rodríguez told CNBC. “If we can build a reputation as a place where students have opportunities, that would go a long, long way toward addressing some of the concerns about return on investment.”
Still, the challenge remains of how to measure career success after graduation in such a rapidly changing labor market, he said.
At the same time, colleges and universities have been very slow to adapt, according to Fuller. “Higher education is deeply ill-equipped to deal with rapid change,” he said.
Despite these obstacles, CUNY’s Matos Rodríguez said universities must “create structures that allow us to pivot.”
This means guiding students towards in-demand career paths, especially as AI creates opportunities in one industry or another, he said: “This shouldn’t be like higher education failing because they can’t read the crystal ball.”
