College degree no longer guarantees post-grad employment
Hope Anderson tracks her job search in a spreadsheet, highlighting the rejections in red.
After more than six months and 40-plus applications, she's seeing nothing but red.
'I knew it was going to be hard, and I knew it was going to be a lot of work,' said the 21-year-old Eden Prairie, Minnesota, resident, who graduated from Iowa State University in May with an event-management degree. 'But I didn't think that I would have absolutely nothing after months.'
A growing group of young, college-educated Americans are struggling to find work as the unemployment rate for recent graduates outpaces overall unemployment for the first time in decades.
While the national unemployment rate has hovered around 4% for months, the rate for 20-something degree holders is nearly 6%, data from the Federal Reserve Bank of New York shows. The amount of time young workers report being unemployed is also on the rise.
Economists attribute some of the shift to normal post-pandemic cooling of labor market, which is making it harder for job-seekers of all ages to land a gig. But there's also widespread economic uncertainty causing employers to pull back on hiring and signs AI could replace entry-level positions.
Employers added 139,000 jobs in May with unemployment unchanged at 4.2%, according to data the U.S. Bureau of Labor Statistics released last week.
But the report 'points to an economy and employment that is weakening somewhat and gives some cause for continued concern over the direction of stagflation,' said David Royal, chief financial and investment officer at Thrivent Financial, in a statement.
'There is underlying weakness in today's report with downward revisions to the prior two months and a decline in labor force participation, signaling a weakening employment picture,' he said.
The struggle for recent graduates comes down to a mismatch between worker supply and employer demand, said Matthew Martin, senior U.S. economist at Oxford Economics. That's not going to change anytime soon, he said.
'What we're actually likely to see over the coming months is a weaker labor market, just as businesses in general are dealing with high levels of uncertainty, reduced demand due to tariffs, higher input costs,' he said. 'This issue for college graduates is only likely to get worse before it gets better.'
College graduates historically have fared better in the job market than those without a degree, earning higher salaries and facing lower unemployment.
'At the same time, younger workers are those who are going to be a little less firmly attached to the labor force and will be especially sensitive to the labor market conditions that they experience when they go out and look for work,' Ryan Nunn with the Federal Reserve Bank of Minneapolis said earlier this month.
Entering the labor market in an economic downturn can limit career success. Many millennials who graduated into the Great Recession saw big drops in earnings and recovered more slowly than older workers, according to data from the Minneapolis Fed.
The U.S. is not currently in a recession, though recent graduates are finding themselves in a similar bind. For some, that has meant rethinking the kinds of jobs they're willing to take.
Mankato, Minnesota, native Rachel Kuzma, 31, earned an anthropology Ph.D. from Washington University in St. Louis a year ago. After hundreds of job applications, she has landed just two unsuccessful interviews. At this point, she said, she just needs a job.
'Any thought I had about a career trajectory is just gone now, because the market just won't allow it,' Kuzma said.
Sophia Sailer, who graduated with a master's degree in marketing from the University of Minnesota's Carlson School of Management in May, recently accepted a part-time hourly job after months of networking and more than 60 job applications. Plans to move out of her parents' Eden Prairie home are on hold.
It's disappointing, Sailer said, but not a shock: After graduating from high school in 2020, she's no stranger to derailed plans.
'It's just very interesting how every time I graduate, it's a new challenge ahead,' she said.
Business schools nationwide were among the first to see the labor market shift in early 2023 as tech industry cuts bled into other sectors, said Maggie Tomas, Business Career Center executive director at Carlson. Tariffs and stock market volatility have only added to the uncertainty, she said.
In 2022, when workers had their pick of jobs, 98% of full-time Carlson MBA graduates had a job offer in a field related to their degree within three months of graduation, according to the school. That number, which Tomas said is usually 90% or higher, dropped to 89% in 2023 and 83% in 2024.
Part of the challenge, she said, is recent graduates are now competing with more experienced workers who are re-entering the market amid layoffs and hiring freezes.
'There are very few companies that are saying, 'We're no longer going to recruit this year,' ' Tomas said. 'They're still hiring; they're just hiring less.'
After doing a lot of hiring in 2021 and 2022, Securian Financial in St. Paul is prioritizing internal hires, said Human Resources Director Leah Henrikson. Many entry-level roles have gone to current employees looking for a change, she said.
'We are still looking externally, it's just the folks that we are looking for externally tend … to fulfill a specific skill gap we may have at that moment in time,' Henrikson said.
The company still continues to cast a wide recruiting net, she said, knowing the job market ebbs and flows. Securian is among local employers partnering with Metro State University on an apprenticeship program that recently resulted in a job offer for one participant and application opportunities for two others.
After working a variety of jobs, from his parents' farm to the North Dakota oil fields, Securian apprentice Leonard Lange decided to pursue a data science degree in 2021 when the market was hot. The 33-year-old from Bloomington, Minnesota, is optimistic about his job prospects but recognizes the landscape has shifted.
'If you're a student applying, you really do need to do some research on the company and tailor your resume a bit more than, I think, if it was three years ago,' he said.
For Anderson and her spreadsheet, the post-graduation job search continues to be a waiting game. She's doing informational interviews, filling out applications and crossing her fingers for something in her field.
At the moment, she is not technically unemployed: She has returned to the part-time job at Scheels sporting goods store where she's worked every summer since high school.
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© 2025 The Minnesota Star Tribune.
Distributed by Tribune Content Agency, LLC.
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