The Entry-Level Job Crisis: Why College Graduates Are Struggling to Launch Their Careers and What Can Be Done

The Breaking Formula

This fall, some 19 million undergraduates returned to U.S. campuses with a long-held expectation: Graduate, land an entry-level job, climb the career ladder. That formula is breaking down.

The Vanishing Entry-Level Opportunity

Once reliable gateway jobs for college graduates in industries like finance, consulting and journalism have tightened requirements. Many entry-level job postings that previously provided initial working experience for college graduates now require two to three years of prior experience, while AI, a recent analysis concluded, "snaps up good entry-level tasks," especially routine work like drafting memos, preparing spreadsheets and summarizing research.

Without these proving grounds, new hires lose chances to build skills by doing. And the demand for work experience that potential workers don't have creates an experience gap for new job seekers. Once stepping-stones, entry-level positions increasingly resemble mid-career jobs.

The AI Impact and Unemployment Reality

No doubt AI is and will continue to reshape work in general and entry-level jobs in particular in expected and unexpected ways. But we are not doomed to what some call an "AI job apocalypse" or a "white-collar bloodbath" that leads to mass unemployment.

The Federal Reserve Bank of New York reported that in March 2025, the unemployment rate for college graduates ages 22 to 27 was 5.7 percent, compared to an overall unemployment rate of 4.0 percent. Other than the temporary pandemic-related spike in 2021, that was the highest unemployment rate for new grads since 2014.

The experience gap phenomenon is not limited to the tech sector. In 2019, 61 percent of AI-related job postings were in the information technology and computer science sector, with 39 percent in non-tech sectors. By 2024, the majority (51 percent versus 49 percent) of AI-related job postings were outside the tech sector.

The Broader Consequences

The cumulative effect of all this is apparent. The hollowing out of entry-level work stalls mobility across the labor market, leaving many college graduates stranded before their careers can even begin. Moreover, these changes cut to the core of higher education's promise.

If graduates can't secure meaningful jobs, confidence in higher ed falters — one reason why it should come as no surprise that 56 percent of Americans think earning a four-year degree is not worth the cost, a March 2023 Wall Street Journal-NORC poll found, compared with 42 percent who think it is, a new low in a poll first administered in 2013.

The collapse of entry-level jobs isn't just a cyclical downturn. It's a structural shift. Left unchecked, this dynamic will deepen inequality, slow social mobility and further undermine faith in higher education.

Five Practical Solutions to the Experience Gap

Apprenticeships and Other Earn-and-Learn Models

Earn-and-learn apprenticeships are a promising, direct solution to the experience gap. They combine paid work with structured training and provide years of experience to college students in those jobs. Sectors from tech to health care are experimenting with this model, examples of which include registered apprenticeships, youth apprenticeships, pre-apprenticeships and apprenticeship degrees that allow individuals to pursue a degree while they work in an apprenticeship.

Skills-Based Hiring and Alternative Credentials

Initiatives such as skills-first hiring by major employers like IBM, Google and Apple aim to evaluate candidates based on their competencies rather than their degrees. Microcredentials, industry certificates and portfolios can serve as verifiable signals of skills gained through alternative training routes.

Stronger College and Employer Partnerships

Colleges can (and should) embed work-based learning into curricula through co-op programs, project-based courses and partnerships with local industries. Northeastern University and Drexel have long pioneered this model. And others, such as Western Governors University and Southern New Hampshire University, are using online learning to advance this approach. Scaling this solution could help close the experience gap.

Policy Innovations

Governments can play a role by giving incentives to companies to create early career opportunities. Workforce Pell, recently enacted in President Trump's One Big Beautiful Bill Act, expands financial aid to use for short-term training programs, opening new pathways for students who may not be pursuing traditional degrees. Tax credits for apprenticeship sponsors and funding for regional workforce hubs could further expand opportunities.

Reimagining Internships

Expanding access to paid internships — especially for first-generation and low-income students — could democratize the attainment of experience. Philanthropies and local governments could underwrite stipends to ensure that opportunity isn't reserved for the affluent who can afford unpaid internships or have social networks that connect them to these opportunities.

The challenge presented by this troubling experience gap is urgent. Today's students deserve a college experience and a labor market in which education and effort still translate into opportunity.