📝 usncan Note: Troubling Back-To-School Job News For College-Goers
Disclaimer: This content has been prepared based on currently trending topics to increase your awareness.
Is The First Rung On The Career Ladder Vanishing?
More than 60% of the college class of 2026 are pessimistic about starting their careers.
getty
The roughly 19.6 million undergraduates returning to campus this school year face bad news about bleak job prospects after graduation. Many will leave college indebted and ambitious, only to discover that the entry-level rung of the career ladder is no longer what it once was. They will end up in a job that doesn’t require their degree or be unemployed.
A recent article in The Atlantic titled “The Job Market Is Frozen” by staff writer Roge Karma tells the story of his younger brother who graduated with honors from a top U.S. private university. Over a six month period, his brother completed 576 job applications, received 29 responses, and had four interviews, none of which led to a job. Roge is an economist, so he was motivated to examine the situation in more depth.
He concludes that “Unemployment is low, but workers aren’t quitting and businesses aren’t hiring. What’s going on? Call it the Big Freeze. A job market with few hiring opportunities is especially punishing for young people entering the workforce or trying to advance up the career ladder, including those with a college degree.””
Many college students sense this.
A survey of the Class of 2026 by Handshake, a career platform, found that more than 60% of bachelor’s degree seekers are pessimistic about starting their careers, with half of them saying the impact of artificial intelligence is a factor in their outlook.
The data confirm their pessimism.
A report by the Strada Institute for the Future of Work and the Burning Glass Institute found that one year after graduation, 52% of recent four-year college graduates are underemployed—working in jobs that don’t require their degrees.
Even a decade later, 45% remain underemployed. Among those who start underemployed, 88% stay in jobs that offer wages and require skills similar to high school-level positions.
This is a sobering back-to-school fact for college undergraduates.
The Vanishing First Rung
For decades, higher education promised a straightforward bargain: earn a degree, land an entry-level job, and climb the career ladder. That compact is unraveling.
Entry-level roles are shrinking or being redefined. Employers are demanding prior experience for jobs meant to provide it. A diploma may still confer symbolic value. But for a growing number of graduates, it no longer guarantees a foothold in the labor market. The bridge between college and career has grown hazardous.
An analysis from Oxford Economics shows that postings for entry-level jobs requiring a bachelor’s degree are down more than 20% compared to pre-pandemic levels. Once reliable job launchpads in gateway fields such as finance, consulting, and journalism now routinely demand two or more years of prior experience.
As Wharton professor Peter Cappelli observes: “Everyone wants to hire somebody with three years’ experience, and nobody wants to give them those three years.” The result is an experience gap—a Catch-22 that stalls mobility before it begins.
Artificial intelligence seems to accelerate the process. On the one hand, it replaces individuals by automating routine tasks such as summarizing reports, preparing spreadsheets, and drafting memos, which were once entry-level training grounds for new workers. On the other hand, it augments the work individuals do, serving as a copilot or worker partner, raising the bar for what employees can contribute.
“GenAI will open doors for some workers while simultaneously closing them for others,” concludes a Burning Glass Institute report on how AI is reshaping the workforce.
Labor market data underscore the squeeze. The Federal Reserve Bank of New York reports that the unemployment rate for college graduates ages 22–27 reached 5.8% in April 2025, compared to 4% for the overall labor market. Other than the pandemic spike in 2021, this is the widest gap in more than 30 years.
This challenging environment now extends well beyond technology jobs. An analysis by Lightcast, a labor analytics firm, shows that AI-related job postings are increasingly outside the tech sector. In 2019, 61% of AI job postings were in information technology and computer science. By 2024, 51% were outside tech, reshaping entry-level work across finance, healthcare, law, media, and beyond.
The authors of a recent National Bureau of Economic Research paper, Canaries in the Coal Mine?, put the matter starkly: “The AI revolution is beginning to have a significant and disproportionate impact on entry-level workers in the American labor market.”
The Regressive College Wage Premium
The financial calculus of higher education is also shifting. For decades, economists touted the college wage premium—the extra lifetime income earned by workers with degrees compared to those with only high school diplomas.
But new research complicates this story. Another National Bureau of Economic Research paper found evidence of what the authors call “collegiate regressivity” starting around 1960. The financial return on a college degree has become increasingly stratified.
Students at elite institutions still experience robust wage premiums, while students at less selective colleges often see diminished or nonexistent returns. In today’s labor market, the value of a diploma depends heavily on where you went, what you studied, and your family background.
Graduates from selective universities in lucrative fields still command high salaries. But for many others, particularly first-generation students from modest backgrounds, the payoff is uncertain, and sometimes indistinguishable from that of non-graduates.
Rethinking On-Ramps
If the bridge between education and employment is crumbling, how can we rebuild it? Here are four suggestions.
1) Redesign curricula to include work-based learning. Colleges should integrate paid, credit-bearing work experiences into their degree programs, including co-ops, internships, and project-based partnerships. Models like Northeastern University’s co-ops or Drexel University’s work-integrated learning should no longer be the exception. Every graduate should leave with both academic credits and practical work experience.
2) Expand apprenticeships and earn-and-learn models. Apprenticeships are the most direct solution to the experience gap. By combining wages, training, and work experience, they give students the “missing three years” that employers demand. These programs should extend beyond the trades into fields like law, finance, media, and healthcare.
3) Hold non-degree credentials accountable for outcomes. Microcredentials, badges, job certificates, and other alternatives will succeed only if their labor market payoffs are transparent. An analysis of over 1.1 million credentials found that only 12% deliver significant wage gains. Credentials must be measured by outcomes, not just listed on LinkedIn.
4) Carry out policy innovation. Public and private partnerships should incentivize employers to provide job experience for young people through various mechanisms, such as tax credits for paid internships and apprenticeships. The new federal Workforce Pell, allowing low-income students to use federal Pell Grants for short-term certificate programs, should aid these efforts.
This fall, millions of students return to campuses believing in the promise of higher education. But the compact of “degree, job, mobility” no longer holds automatically. Unless colleges, employers, policymakers, and other stakeholders reimagine the pathways into work, too many will graduate into disappointment.
