Once seen as a “ticket to a better life” and a guarantee of a stable future, the luster of a university degree in the United States is now fading.

Amid a wave of government spending cuts, wars, and pressure from artificial intelligence (AI), America’s young workforce is entering the toughest job market in years.

Anxiety after graduation

As a long-standing tradition, every May, soon-to-be college graduates flock to Washington Square Park in New York in colorful regalia.

Students in their twenties gather for photos, celebrating the moment they become new graduates. But behind those smiles now lies anxiety about their job prospects.

Julie Patel, who just completed a master’s degree in public health, shared with Al Jazeera on May 17 that the gloomy job market has dimmed the joy of graduation day.

Similarly, Salvadore (23 years old) told CNBC that she has sent out hundreds of applications without any response.

“When someone asks what you’re doing, I can only sadly reply: I’m at my parents’ house, glued to LinkedIn 24 hours a day,” Salvadore confessed.

In an NBC News survey of over 100 recent college graduates in the US, many described their job search journey with phrases like “falling into a black hole,” “discouraging,” or “feeling like a college degree doesn’t mean much anymore.”

According to the Federal Reserve Bank of New York, the unemployment rate for recent graduates in 2025 rose to 5.3%, higher than the roughly 4% rate for the entire workforce—a rare occurrence in the history of the US job market.

The situation on the employer side is also not optimistic. Data from Handshake, a recruitment platform for US students, shows that job postings decreased by 15-16% between August 2024 and August 2025 compared to the same period the previous year, while the number of applications per position increased by 26-30%.

A survey by Cengage Group also found that only about 30% of 2025 graduates found full-time jobs in their field of study.

Multiple reasons since the COVID-19 pandemic

According to analysts, the difficulties for young graduates stem from the post-COVID-19 hiring slowdown. However, they confirm that this situation is worsening due to corporate caution amid economic uncertainty, especially with constant changes in tariff policies and federal spending under the Trump administration.

Last spring, the Department of Government Efficiency (DOGE), led by billionaire Elon Musk, implemented a series of cuts to federal programs and budgets, resulting in a significant reduction in the public sector workforce.

Furthermore, many universities and research institutes have been forced to freeze hiring or cut staff. Recently, schools like Duke, Harvard, Maryland, and Princeton have all announced hiring restrictions or layoffs.

Alongside this, geopolitical upheavals, from prolonged conflicts to escalating US-Israel-Iran tensions, have added to global business uncertainty.

“Recent times have seen enormous uncertainty around tariffs, interest rates, inflation, and geopolitics. That leads many businesses to choose to wait rather than risk hiring more people,” economist Brad Hershbein told Newsweek.

In this context, the rapid and massive rise of AI further threatens the young labor market. Many companies have started using AI to replace positions like customer service or basic programming.

According to Fortune magazine, in just the first seven months of 2025, AI caused over 10,000 job cuts in the US. A Goldman Sachs survey in April 2026 also showed that AI is causing the US economy to lose an average of about 16,000 jobs per month.

Anthropic CEO Dario Amodei has repeatedly warned that AI could wipe out half of all low-level office jobs within the next five years.

BlackRock CEO Larry Fink also stated that 2026 graduates may face the highest unemployment rate ever, partly because AI is replacing more and more entry-level positions.

Washington Square Park

Washington Square Park is a historic public park in Greenwich Village, New York City, known for its iconic arch and vibrant cultural scene. Originally a marshland and later a public execution ground in the 18th century, it became a park in the 19th century and evolved into a hub for artists, activists, and musicians. The park is also closely tied to New York University and has been a site for protests, performances, and community gatherings for over a century.

New York University

New York University (NYU) is a prestigious private research university located in New York City, founded in 1831 by a group of prominent citizens including Albert Gallatin. It was established with the vision of providing a secular, modern education open to all, regardless of background, and has since grown into one of the largest private universities in the United States. Today, NYU is renowned for its global campuses, diverse student body, and strong programs in the arts, business, and law.

Yankee Stadium

Yankee Stadium, located in the Bronx, New York City, is the legendary home of the New York Yankees baseball team. The original stadium opened in 1923 and hosted iconic moments and players like Babe Ruth and Lou Gehrig before closing in 2008; the current stadium opened in 2009 on a nearby site, preserving the team’s rich history and tradition. It remains a symbol of baseball greatness and a major cultural landmark in the city.

Duke

“Duke” typically refers to Duke University, a private research university in Durham, North Carolina, founded in 1838. Originally established as Brown’s Schoolhouse, it was renamed in 1924 after the Duke family, prominent tobacco and energy industrialists. Today, it is known for its prestigious academic programs, Gothic architecture, and the iconic Duke Chapel.

Harvard

Harvard University, founded in 1636 in Cambridge, Massachusetts, is the oldest institution of higher learning in the United States. Originally established to train Puritan clergy, it has evolved into a world-renowned research university with a rich history of academic excellence and influential alumni. Today, Harvard’s iconic campus and libraries continue to symbolize prestige and innovation in education.

Maryland

Maryland, one of the original thirteen colonies, was founded in 1632 as a haven for English Catholics seeking religious freedom. Its history is marked by its role in the American Revolution and the Civil War, as a border state where slavery was legal but remained in the Union. Today, it is known for its diverse landscapes, from the Chesapeake Bay to the Appalachian Mountains, and its cultural contributions, including the birthplace of the U.S. national anthem at Fort McHenry.

Princeton

Princeton is a historic town in New Jersey, best known as the home of Princeton University, founded in 1746 as the College of New Jersey. The town played a key role in the American Revolution, notably hosting the Battle of Princeton in 1777, where George Washington secured a crucial victory. Today, it combines a vibrant academic community with well-preserved colonial architecture and cultural landmarks.

Federal Reserve Bank of New York

The Federal Reserve Bank of New York, located in Manhattan’s Financial District, is the most influential of the twelve regional Federal Reserve banks, overseeing the nation’s monetary policy implementation and holding the world’s largest gold storage vault. Founded in 1914, it played a central role in stabilizing financial markets during the Great Depression and the 2008 crisis. Its iconic building, completed in 1924, features a fortress-like design symbolizing security and economic strength.