The share of long-term unemployed workers with college degrees has been on the rise, according to government data compiled by two researchers at the University of Chicago, reports The New York Times.
The trend is attributed to various factors, including increased use of artificial intelligence in the workforce, changing labor market dynamics, and a skills gap between graduate training and employer demands.
"The data is signaling that there's some restructuring going on," Andreas Mueller, an expert on long-term unemployment at the University of Zurich, told the Times. "People are losing jobs and can't find jobs in high-skilled occupations."
A report published by the Federal Reserve Bank of St. Louis in late August found that recent college graduates have been hit disproportionately hard by a softening labor market following the post-pandemic recovery. Their average unemployment rate in 2025 rose to 4.59%, more than double the increase in the overall labor force unemployment rate.
"The potential issue is that the labor market is changing — fast," Philip Oreopoulos, professor of economics and public policy at the University of Toronto, told Newsweek.
"Employers are not currently looking for recent college graduates like they used to, perhaps because current employees are able to do more than before or perhaps because their firm's productivity is changing, using technology and labor in ways that lead to lower demand for typical college grad skills."
The Cengage Group 2025 Graduate Employability Report, published last week, found that just 30% of 2025 college graduates and 41% of 2024 graduates found entry-level jobs in their field.
Michael Hansen, its CEO, said the widening career readiness gap, "along with the growing demand for upskilling driven by technological advancements like AI, is creating an urgent need to rethink how we equip learners for future employment."
He added, "Closing this skills mismatch is essential to narrowing the wealth gap. When people can put their skills to work, they gain not just income, but also purpose, dignity, and the stability that comes with building a sustainable career. To achieve this, the entire education ecosystem must work together to ensure the U.S. system keeps pace with an ever-changing world."
Solange Reyner ✉
Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting and covering news, sports and politics.
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