College graduates face toughest job market in more than a decade as hiring slows

By CHRISTOPHER RUGABER AP Economics Writer WASHINGTON AP While completing a master s degree in statistics analysis Palwasha Zahid moved from Dallas to a town near Silicon Valley The location made it easy to visit the campuses of tech stalwarts such as Google Apple and Nvidia Zahid completed her studies in December but so far she hasn t exposed a job in the industry that surrounds her It stings a little bit she noted I never imagined it would be this arduous just to get a foot in the door Young people graduating from college this spring and summer are facing one of the toughest job markets in more than a decade The unemployment rate for degree holders ages to has reached its highest level in a dozen years excluding the coronavirus pandemic Joblessness among that group is now higher than the overall unemployment rate and the gap is larger than it has been in more than three decades The rise in unemployment has worried a great number of economists as well as agents at the Federal Reserve because it could be an early sign of trouble for the business activity It suggests businesses are holding off on hiring new workers because of rampant uncertainty stemming from the Trump administration s tariff increases which could slow increase Young people are bearing the brunt of a lot of economic uncertainty Brad Hersbein senior economist at the Upjohn Institute a labor-focused think tank reported The people that you often are preponderance hesitant in hiring when economic conditions are uncertain are entry-level positions The development of artifical intelligence may be playing an additional role by eating away at positions for beginners in white-collar professions such as information tool finance and law Higher unemployment for younger graduates has also renewed concerns about the value of a college degree More workers than ever have a four-year degree which makes it less of a distinguishing factor in job applications Murat Tasci an economist at JPMorgan calculates that of workers have a four-year degree up from in While the difficulty of finding work has demoralized young people like Zahid most of economists argue that holding a college degree still offers clear lifetime benefits Graduates earn higher pay and experience much less unemployment over their lifetimes The overall U S unemployment rate is a still-low and the establishment s monthly jobs reports show the business sector is generating modest job gains But the additional jobs are concentrated in wellbeing care leadership and restaurants and hotels Job gains in professions with more college grads such as information instrument legal services and accounting have languished in the past months The unemployment rate has stayed low mostly because layoffs are still relatively rare The actual hiring rate new hires as a percentage of all jobs has fallen to levels when the unemployment rate was much higher at Economists call it a no-hire no-fire business activity For college graduates to years old the unemployment rate was in March the highest excluding the pandemic since and far above the nationwide rate Lexie Lindo saw how reluctant companies were to hire while applying for more than jobs last summer and fall after graduating from Clark Atlanta University with a business degree and GPA She had several summer internships in fields such as logistics and real estate while getting her degree but no offer came Nobody was taking interviews or responding back to any applications that I filled out Lindo who is from Auburn Georgia disclosed My resume is full there s no gaps or anything Every summer I m doing something It s just OK so what else are you looking for She has returned to Clark for a master s venture in supply chain studies and has an internship this summer at a Fortune company in Austin Texas She s hopeful it will lead to a job next year Related Articles US stocks drift toward their record after erasing almost all their springtime drop US business activity shrank between January and March worse than earlier estimates had revealed Trump gets golden share power in US Steel buyout US agencies will get it under future presidents Judge dismisses authors copyright lawsuit against Meta over AI training Massachusetts congressman ticked off at locked-up products at CVS amid rampant shoplifting Artificial intelligence could be a culprit particularly in IT Matthew Martin senior U S economist at Oxford Economics has calculated that employment for college graduates and above in computer science and mathematical occupations has increased a slight since For those ages to it has fallen according to Martin Company announcements have further fueled concerns Tobi Lutke CEO of online commerce program company Shopify noted in an April memo that before requesting new hires teams must demonstrate why they cannot get what they want done using AI Last week Amazon CEO Andy Jassy explained AI would likely reduce the company s corporate work force over the next limited years We will need fewer people doing certain of the jobs that are being done the present day and more people doing other types of jobs Jassy explained in a message to employees We expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company Zahid worries that AI is hurting her chances She remembers seeing big billboard ads for AI at the San Francisco airport that demanded Why hire a human when you could use AI Still multiple economists argue that blaming AI is premature Preponderance companies are in the early stages of adopting the mechanism Professional networking platform LinkedIn categorized occupations based on their exposure to AI and did not see big hiring differences between professions where AI was more prevalent and where it wasn t reported Kory Kantenga the firm s head of economics for the Americas We don t see any broad-based evidence that AI is having a disproportionate impact in the labor industry or even a disproportionate impact on younger workers versus older workers Kantenga noted He added that the Federal Reserve s interest rate hikes have also slowed hiring in tech Multiple IT firms expanded when the Fed pinned its short-term rate at nearly zero after the pandemic In the Fed began cranking up rates to combat inflation which made it harder to borrow and grow In fact IT s hiring spree when rates were low fueled by millions of Americans ramping up their online shopping and video conferencing left countless firms with too a multitude of workers economists say Cory Stahle an economist at the job-listings website Indeed says postings for platform improvement jobs for example have fallen compared with four years ago It s a sharp shift for students who began studying computer science when hiring was near its peak Zahid who lives in Dublin California has experienced this whiplash firsthand When she entered college in her father who is a configuration engineer encouraged her to review IT and revealed it would be easy for her to get a job in the field She initially studied psychology but decided she wished something more hands-on and gravitated to information analysis Her husband has a program growth job and friends of hers in IT received immediate job offers upon graduation a meager years ago Such rapid hiring seems to have disappeared now she revealed She has her college diploma but hasn t hung it up yet I will put it up when I genuinely get a job confirming that it was worth it all she disclosed AP Writer Matt Sedensky in New York contributed to this summary