Today's college graduates are walking into a job market that looks nothing like the one their older siblings entered, with artificial intelligence now taking over tasks that once formed the core of entry-level employment.

The New York Federal Reserve reports that the unemployment rate for college graduates aged 22 to 27 hit 4.8% in June 2025. That's up from 3.8% in May 2022 and notably higher than the national average of 4.0%. This reversal of long-standing trends marks a structural shift in the labor market.

For most of the past 35 years, younger workers had lower unemployment thanks to greater flexibility and ease of retraining. But over the past decade, that trend has changed, with entry-level roles shrinking in number or evolving rapidly due to technology.

Employers Hiring Fewer Entry-Level Workers

A recent Cengage Group survey found that 75% of employers plan to hire the same or fewer entry-level employees in 2025. That's up from 69% the year before.

The top reasons were a tight labor market (51%), AI and other emerging technologies (46%), and the state of the economy (46%).

What’s more troubling is the declining need for entry-level talent. Only 35% of employers now say they’re having trouble finding such workers—down sharply from 65% in 2022.

For recent grads, the situation is just as grim: less than one-third have landed full-time work related to their degree, and only 51% feel they have the AI-related skills needed for available roles.

Which Jobs Are Most at Risk from AI?

The U.S. Bureau of Labor Statistics estimates that, between 2009 and 2029, the following jobs face the highest automation risk:

Fast food and counter workers: about 4.5 million

Retail salespersons: about 4.2 million

Cashiers: about 3.3 million

Laborers and freight movers: just over 3 million

Meanwhile, roles requiring creative judgment, high social interaction or domain expertise—like journalists, interpreters, and surgeons—are far less likely to be automated.

Welcome To The "Finger Economy"

According to a Bank of America Institute report, roles with repetitive, routine tasks—both cognitive and manual—are most vulnerable to automation.

But AI isn't just eliminating roles; it's also reshaping the types of jobs being created.

A new labor dynamic, described as the “finger economy,” is emerging.

These jobs involve digital interactions with screens and devices rather than physical labor. While they offer new kinds of work, they also bring challenges: limited labor protections, low pay, screen fatigue, and job insecurity.

These roles often fall outside traditional employment benefits and may be excluded from union protections. For many Gen Z workers, especially those without specialized tech skills, this can lead to unstable employment and deteriorating mental health.

Can AI Create More Jobs Than It Destroys?

There is potential for net job creation if AI is implemented responsibly. Emerging sectors like renewable energy, cybersecurity, digital health, and AI model governance may offer new opportunities—if companies and governments invest in training and education.

Bank of America Global Research emphasizes that many jobs will evolve rather than disappear.

But to ensure a fair transition, public and private sectors must coordinate efforts to retrain workers, adapt education systems, and invest in inclusive innovation strategies.

AI’s Role in Advancing—or Hindering—Global Goals

A 2020 study published in the journal Nature found that AI could support 82% of the United Nations' Sustainable Development Goals (SDGs), particularly those tied to education, health and environmental sustainability.

However, it could also negatively affect 38% of these goals—especially those concerning inequality and fairness.

This dual potential highlights the urgency of regulating AI use. Without ethical frameworks, AI risks deepening social divides, even as it promises efficiency and innovation.

Image: Shutterstock/Raushan_films