Navigating today’s job market is no easy feat for recent college graduates. According to the latest analysis from the Federal Reserve Bank of New York, the labor market remains tough. The NY Fed’s research, which tracks employment data since 1990, highlights how these challenges reflect broader, long-term trends — and serve as a reminder that a college degree, while valuable, is not a guaranteed ticket to a career-level job right away. Underemployment is defined carefully here: it represents grads working in roles that typically do not require a bachelor’s degree, as established by rigorous survey data.
The latest data highlights both challenges and opportunities in the current labor market.
Key Findings
1. Unemployment and Underemployment Rates
- As of the second quarter of 2025, the unemployment rate for recent college graduates stands at 5.3%, consistent with the first quarter.
- The underemployment rate, defined as working in jobs that typically do not require a college degree, remains above 41%.(Federal Reserve Bank of New York, Federal Reserve Bank of New York)
2. Earnings by Major
- Graduates in technical and specialized fields tend to have higher median wages. For instance, aerospace engineering majors have early-career median wages around $72,000, with mid-career wages reaching approximately $112,000.
- In contrast, majors like anthropology and philosophy report higher unemployment rates and lower median wages.
3. Trends Over Time
- The data indicates a persistent trend of underemployment among recent graduates, with variations across different majors and industries.
- While some fields show improvement, others continue to face challenges in aligning graduate skills with market demands.
Implications for Stakeholders
- For Students: It’s crucial to consider labor market trends when choosing a major. Fields with higher demand and specialized skills often offer better employment prospects and earning potential.
- For Educational Institutions: Colleges and universities should provide career services that align academic programs with industry needs, ensuring graduates are well-prepared for the job market.
- For Employers: Engaging with educational institutions to shape curricula can help bridge the skills gap, leading to a more qualified workforce.
The Federal Reserve Bank of New York’s interactive feature provides valuable insights into the evolving landscape of the labor market for recent college graduates. By understanding these trends, stakeholders can make informed decisions to navigate the complexities of today’s job market.
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