If College Doesn’t Guarantee a Job Anymore, What Does?

In the past, a college degree was one of the strongest predictors there was of getting a decent job.

For the past few years, however, graduates have been struggling. According to the Federal Reserve’s data, college graduates aged 20–24 had an unemployment rate of 9.7% in July 2026, the highest since June 2021—when the US was still reeling from the effects of the pandemic. 1

While their unemployment rate dropped to 8.0% in August 2026, in general, it’s been trending upward since December 2021.

A lack of entry-level jobs

One of the biggest problems for new graduates is that entry-level jobs are on the decline. According to a widely shared analysis from Cadient.ai which was later cited by Forbes, the number of entry-level jobs requiring no experience has fallen by about 73% over the past four years. 2

In an interview with The Washington Post in May 2026, journalism graduate Samantha Gilstrap, 28, said that she’s been struggling to find work since graduating in 2019. Since losing her digital reporting job at WUSA9, she has applied for hundreds of jobs, but most of those applications have led nowhere.

“The only times I’ve been able to interact with humans is if it’s a who-you-know basis,” she said. “At some point, if things don’t work out, I will be walking into the nearest McDonald’s.”

The role of AI in job applications

Gilstrap’s experience points at a growing problem graduates are facing: AI’s encroachment on the hiring process.

Many companies and recruiters use AI tools called applicant tracking systems (ATS), which automatically screen candidates’ applications. According to data from the ATS platform TrackerRMS, 75% of recruiters use an ATS or another tech-driven recruiting tool. 3

ATSes work by searching for keywords in candidates’ applications. For instance, say you’re applying for a job as a developer, and the role requires knowledge of JavaScript. If you don’t include the keyword “JavaScript,” the ATS will flag that, and you’ll be considered less of a match or even disqualified outright.

That might not sound like such a bad thing, but in an oversaturated labor market, it becomes a problem. The issue is that seemingly minor, easily missable keywords can also become disqualifying when they’re omitted.

According to data from the career coaching site Interview Success Formula, which was also cited by Forbes, job postings receive 118 applications on average, with only 20% of candidates getting interviews. 4 With so many candidates applying for the same jobs, those whose applications don’t have a 100% match to the job description are essentially invisible.

In a late-2025 poll from NBC News, only 33% of respondents agreed with the statement that a four-year degree is “worth the cost because people have a better chance to get a good job and earn more money over their lifetime.”

Jacob Kennedy, a 28-year-old grad from a 2-year program, told NBC that he’s met plenty of people who’ve completed 4-year degrees who are now struggling to pay off their student debts.

“The cost overwhelms the value,” he said. “You go to school with all that student debt—the jobs you get out of college don’t pay that debt, so you have to go find something else that can.”

Even worse for prospective students, college is getting more expensive. According to data from the National Center for Education Statistics, the average cost of college (adjusted for inflation) has risen by 128% over the past 60 years. 5

These costs have prompted many young Americans to reconsider the traditional route of enrolling in college straight after graduating. According to widely shared data from the Bureau of Labor Statistics (BLS), the number of graduates enrolling in 4-year degrees straight after high school dropped from 70% to 62% over the past decade.

Are colleges preparing their students for an AI-dominated job market?

According to the Education Advisory Board, a Washington, DC–based education consulting and technology company, many students are switching majors because of the fear of AI.

In their survey of over 9,500 students, 10% of the entering 2025 class had changed majors due to AI-related job security concerns. Nearly half (42%) expect it to influence their career path. 6

Side Hustles spoke with Dr. Eva Wolf, a professor at Colorado State University. Wolf is a researcher and consultant who specializes in AI, marketing, and technology adoption.

Wolf told us that the students she’s spoken to are apprehensive. “What actually comes up in my office hours is a lot of anxiety,” she said. “Uncertainty about the future, and uncertainty about the job opportunities for them.”

When we asked Wolf whether colleges were doing enough to prepare students for the hostile job market post-graduation, she told us that some colleges are “moving in the right direction,” though she added that it “really depends on the discipline.”

“Some disciplines are going to be completely revolutionized due to AI, and some disciplines will not be,” she said, citing marketing as the discipline that will likely be changed the most.

She added that “for certain courses, we owe it to the students to teach them AI” in lockstep with the traditional principles of the field.

“Some schools are doing enough in certain courses,” she said. But “other schools haven’t yet adapted their curriculum to teach it in tandem with AI.”

Wolf argued that a degree “is still worth what it costs,” even if one isn’t enough to land a job straight after graduating anymore.

However, she argued that what matters these days isn’t the formal credential—or even the hard skills you learn from your coursework.

“Nowadays, the degree is more about developing your critical thinking skills and developing an intuition and framework for making decisions in the workplace,” she said. “AI is not going to absolve you of decision-making.”

Soft skills: the real value of a degree

While AI has taken over many base-level tasks, other skills are becoming more important.

According to City University of Seattle, soft skills (such as adaptability, continuous learning, and analytical thinking) are some of the most in-demand skills in 2026, along with: 7

• Business analytics
• Communication
• Emotional intelligence
• Project management
• Transformational leadership

Earlier this year, the National Association of Colleges and Employers (NACE) released its 2026 Job Outlook Report. In the report, employers were asked what they looked for most on a candidate’s resume. The following soft skills ranked highest: 8

• Ability to work in a team (85%)
• Problem-solving skills (82%)
• Verbal communication skills (78%)

These skills are somewhat vaguely defined, and aren’t necessarily what most students explicitly seek to develop when they enroll in college, but graduates who demonstrate them are more likely to succeed in the job market.

Interestingly, only 31% of employers said that AI skills were what they sought the most.

Even though AI literacy is becoming a requirement in many industries, human-centric skills are what give candidates a real edge, at least for now.

Although experts like Wolf believe that college is still worth it, many young people still aren’t convinced. Instead of enrolling in 4-year degrees, young Americans are turning to trade and vocational programs.

The National Student Clearinghouse reports that enrollment at institutions offering these programs grew by almost 20% from spring 2020 to spring 2026. 9

Most of these programs only last two years, and in addition to costing less than a traditional 4-year degree, a lot of young people believe they offer more job opportunities down the line.

Benjamin Davis, a barber based in Los Angeles, told The New York Post that opting for barber school instead of a traditional degree was “the best career decision” he’d ever made.

The jobs AI can’t compete with (for now)

John Pallares, a 29-year-old construction worker from New York, used to work as a sales assistant at T-Mobile. He told The New York Times that he was worried his job would be made obsolete in a few years. Pallares opted for a career in construction, which he feels is safe from the threat of AI.

“That’s one of the things that’s more attractive to me … because it’s some kind of job that, for the moment, AI can’t do,” he said.

There’s something to this line of thinking. AI is disrupting many white-collar fields, but manual labor-oriented fields, such as construction and maintenance, are less vulnerable.

In a recent report from the AI company Anthropic on the Labor Market Impacts of AI, people with physical, hands-on roles, such as cooks and motorcycle mechanics, were found to have the least exposure to AI.

The trade jobs AI is creating

AI may also be creating new jobs for trade workers. In particular, its continuing rise has caused the demand for data centers to surge.

This has resulted in a 30% increase in the market for construction workers, according to a March 2026 global labor report from Randstad. 10

One of the principal arguments in favor of AI is that it actually creates new jobs, but for fresh graduates lacking experience, many of the new AI-oriented roles are high-level and out of their reach.

To an extent, even blue-collar workers are in that situation; Randstad’s report highlights that skilled trade jobs, like robotics technicians and HVAC engineers, saw the biggest increases in demand (107% and 67%, respectively).

However, other trade workers have seen surges in demand, too, albeit less stunning ones.

For many young people, college doesn’t seem like the obvious choice anymore.

For the institutions, this is bad news. If universities want to keep enrollment on track, Wolf believes they need to start preparing their students for the AI landscape.

“I’d like university administrators to start incorporating more hands-on AI projects into their curriculums wherever possible,” she said. “We need to prepare a workforce that is going to be not just AI-enabled or AI-assisted, but AI-native.”

Wolf stressed the importance of what she referred to as project-based learning, an approach that involves tackling real-world problems, often in a workplace setting rather than a classroom.

Schools should “involve local businesses to give our students hands-on experience,” she said, “so that when they do finish school, they’ll have a sense of how to actually do and build things and think for themselves.”

Although Wolf’s advice is directed at colleges, it points to something graduates and prospective students can act on themselves. Whether it’s fair or not, if colleges are still catching up to a world with advanced AI, it’s on students to make sure they put themselves out there and get the skills and experience they need to compete in today’s job market.