Gen Z Graduate Unemployment Holds at 5.6% as Economists Fault Weak Hiring, Not AI
Updated
Updated · Fortune · Jun 25
Gen Z Graduate Unemployment Holds at 5.6% as Economists Fault Weak Hiring, Not AI
1 articles · Updated · Fortune · Jun 25
Summary
Recent college graduates are stuck with a 5.6% unemployment rate, unchanged from a year ago and well above the 4.2% rate for all workers, according to New York Fed data.
Apollo economist Torsten Slok said the gap opened around April 2022—months before ChatGPT’s release—pointing instead to Fed tightening, trade-war uncertainty and slowing immigration in a low-hire, low-fire market.
Those pressures hit AI-exposed entry-level sectors such as warehousing, payroll services and transportation support, making it difficult to separate any AI effect from broader economic weakness.
AI anxiety is still rising: 51% of Gen Z say AI is the biggest threat to job security, while Glassdoor found 53% of AI discussions were negative this year, up from 41% last year.
Fed researchers said young workers are most vulnerable when hiring slows because they depend on new openings, leaving the labor market looking solid overall while becoming less hospitable to new entrants.
Why are firms cutting entry-level jobs in the name of AI, while experts predict it will create more work?
Is the debate over AI distracting from the economic policies actually sidelining a generation of graduates?
2026 Gen Z Graduate Unemployment Hits 3.7%: Remote Work Reshapes Entry-Level Job Market
Overview
Gen Z graduates in March 2026 are facing a tough job market, where their academic achievements often lead straight into worries about healthcare, student loans, and cash flow. While some blame artificial intelligence for these challenges, economists note that AI’s impact is similar to past tech changes and not the main cause. In reality, the main drivers are bigger structural shifts, especially the rise of remote work and broader economic issues. These changes have made it harder for young people to find jobs, showing that Gen Z’s struggles are rooted in deeper, long-term trends rather than just new technology.