Report on Unemployment Challenges Among Recent College Graduates and Sustainable Development Goals (SDGs) Implications

Introduction

In March 2025, the unemployment rate for college graduates aged 22 to 27 reached 5.8%, marking the highest level since 2012, excluding the pandemic period. This report examines the current labor market challenges faced by young graduates, the potential impact of emerging technologies such as artificial intelligence (AI), and the broader implications for achieving the United Nations Sustainable Development Goals (SDGs), particularly SDG 8 (Decent Work and Economic Growth) and SDG 4 (Quality Education).

Current Labor Market Situation for Young Graduates

• The unemployment rate for degree holders aged 22 to 27 surpasses the overall national unemployment rate, with a gap not seen in over three decades.
• Economic uncertainty, including tariff increases and inflation control measures, has led businesses to delay hiring, especially for entry-level positions.
• Job gains are concentrated in sectors such as healthcare, government, and hospitality, while professions requiring college degrees like information technology, legal services, and accounting have seen stagnation.
• The hiring rate has declined to levels last observed in 2014, despite low layoff rates, creating a “no-hire, no-fire” economy.

Impact of Artificial Intelligence on Employment

1. AI adoption is influencing entry-level job availability in white-collar fields such as IT, finance, and law.
2. Employment for college graduates aged 22 to 27 in computer science and mathematical occupations has decreased by 8% since 2022, while it slightly increased for older workers.
3. Major companies like Shopify and Amazon have indicated workforce reductions or hiring freezes linked to AI efficiency gains.
4. Despite concerns, some economists argue that AI’s broad impact on labor markets remains limited at this stage.

Challenges to the Value of a College Degree

• The proportion of workers with a four-year degree has increased from 26% in 1992 to 45%, reducing the degree’s distinguishing power in job markets.
• Young graduates report difficulties securing employment despite strong academic records and relevant internships.
• Nevertheless, holding a college degree continues to provide significant lifetime benefits, including higher earnings and lower unemployment rates.

Case Studies: Experiences of Recent Graduates

• Palwasha Zahid: A 25-year-old data analysis master’s graduate living near Silicon Valley, facing challenges entering the tech industry despite proximity to major companies.
• Lexie Lindo: A 23-year-old business graduate who applied to over 100 jobs without success, now pursuing a master’s in supply chain studies with hopes of future employment.

Economic and Policy Considerations

• Federal Reserve interest rate hikes have contributed to slower hiring in tech sectors, reversing previous expansion fueled by low rates during the pandemic.
• Overexpansion in IT employment during the pandemic has led to workforce adjustments as demand normalizes.
• Economic uncertainty disproportionately affects young workers seeking entry-level positions, highlighting the need for targeted employment policies.

Implications for Sustainable Development Goals (SDGs)

1. SDG 8: Decent Work and Economic Growth
   • Addressing youth unemployment is critical to promoting sustained, inclusive, and sustainable economic growth.
   • Policies encouraging job creation, especially for young graduates, support economic resilience and reduce inequalities.
2. SDG 4: Quality Education
   • Ensuring that higher education aligns with labor market demands enhances employability and lifelong learning opportunities.
   • Investments in skills development, including adapting to technological changes like AI, are essential.
3. SDG 10: Reduced Inequalities
   • Mitigating disparities in employment opportunities for young graduates contributes to reducing inequalities within and among countries.

Conclusion

The rising unemployment rate among recent college graduates underscores significant challenges in the current labor market, exacerbated by economic uncertainty and technological transformation. While AI presents both opportunities and disruptions, strategic policy interventions aligned with the Sustainable Development Goals are essential to foster decent work, enhance education relevance, and reduce inequalities. Supporting young graduates through targeted employment programs and skills development will be vital for sustainable economic growth and social inclusion.

References

• Associated Press, 2025. “Unemployment Rate Among College Graduates Reaches Highest Level Since 2012.”
• Federal Reserve Economic Data, 2025.
• United Nations Sustainable Development Goals, 2015.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 4: Quality Education
   • The article discusses college graduates, their education levels, and the value of a college degree.
   • Focus on higher education attainment and its impact on employment.
2. SDG 8: Decent Work and Economic Growth
   • Central issue is unemployment among young college graduates.
   • Concerns about job market conditions, hiring rates, and economic uncertainty.
   • Impact of technological changes such as AI on employment.
3. SDG 9: Industry, Innovation and Infrastructure
   • Discussion on the role of artificial intelligence and technological innovation affecting labor markets.
   • Impact of AI on jobs in IT, finance, and legal sectors.

2. Specific Targets Under Those SDGs Identified

1. SDG 4: Quality Education
   • Target 4.3: Ensure equal access for all women and men to affordable and quality technical, vocational and tertiary education, including university.
   • Target 4.4: Increase the number of youth and adults who have relevant skills, including technical and vocational skills, for employment.
2. SDG 8: Decent Work and Economic Growth
   • Target 8.5: Achieve full and productive employment and decent work for all women and men, including young people and persons with disabilities, and equal pay for work of equal value.
   • Target 8.6: Reduce the proportion of youth not in employment, education or training.
   • Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation.
3. SDG 9: Industry, Innovation and Infrastructure
   • Target 9.5: Enhance scientific research, upgrade the technological capabilities of industrial sectors, encouraging innovation.

3. Indicators Mentioned or Implied to Measure Progress

1. Unemployment Rate Among Young College Graduates
   • The article states the unemployment rate for college graduates aged 22 to 27 is 5.8% in March, the highest since 2012 excluding the pandemic.
   • This rate is a key indicator for Target 8.5 and 8.6.
2. Overall Unemployment Rate
   • The article compares youth unemployment with the overall unemployment rate (4.2%).
3. Hiring Rate
   • New hires as a percentage of all jobs, which has fallen to 2014 levels.
   • Indicates labor market dynamics and economic productivity (Target 8.2).
4. Employment Changes by Age and Sector
   • Employment for college graduates 28 and above in computer science and math increased slightly (0.8%), while for ages 22-27 it fell 8%.
   • Reflects impact of innovation and AI on employment (Target 9.5).
5. Educational Attainment Rates
   • Percentage of workers with a four-year degree increased from 26% in 1992 to 45% currently.
   • Relevant to Target 4.3 and 4.4.

4. Table of SDGs, Targets, and Indicators

Source: firstcoastnews.com