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The labor market is fundamentally broken for new graduates. After seeing over 30% growth in spring hiring projections during 2022, employers are now projecting essentially flat hiring for 2025 and a meager 1.6% increase for 2026.
Whether we like to admit it or not, one of the significant causes of this is AI. AI is replacing tasks that traditionally belonged to junior employees. Entry level tech positions have declined by roughly 50% compared to pre pandemic levels and Stanford research shows employment for workers aged 22-25 in AI exposed roles dropped 13% since 2022. Companies are discovering that AI can handle customer service inquiries junior engineering tasks, financial analysis and content writing work that used to be for new graduatesThe job market has also created an impossible paradox. Sixty one percent of entry level positions now require 2-3 years of prior experience. Employers no longer want to develop talent they want immediate contribution. Internships and academic projects don't register as valid experience which locks out graduates before they even begin applying. The result is graduate unemployment at 4.8%, the highest June reading in four years and higher than the general population. Skills based hiring was supposed to be the solution but has proven insufficient. While companies claim they prioritize skills over degrees, this benefit accrues mainly to career switchers and experienced workers who can demonstrate accomplishments. Removing degree requirements expands candidate pools without actually helping new graduates, who lack the work history to demonstrate skills in the first place. For the Class of 2026, and future graduates, this represents a genuine market failure. The traditional credential to employment pathway is broken. Companies want proven performers over potential. The barriers to entry are higher than in decades and this will only get to worse as AI advances. What do you think the solution to all this is?Source: StockMarket.News
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