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A fresh college degree used to come with a quiet edge in the job market. New grads had better odds of landing work than the average worker, and that edge held for as long as anyone tracked it. Not anymore. They now face higher unemployment than the workforce as a whole, and the gap is the widest on record.
What makes this strange is the timing. The reversal did not start with ChatGPT, and it did not start with the pandemic. It started in early 2019, before either one was on the radar.
The chart tracks a single number, a recent grad's unemployment rate minus the rate for all workers. Below the zero line grads come out ahead of the typical worker, and above it they fall behind.
The comparison is worth pinning down. "All workers" is the whole U.S. labor force, and most of them are older and more experienced than a new graduate, so a fresh grad starts at a natural disadvantage. For decades the degree more than canceled that disadvantage out. Now it does not.
For decades, the degree was a buffer
A recent grad almost always had a better shot at being employed than the average worker. The cushion was real, and it was biggest exactly when the economy was worst.
The edge peaked in the depths of the Great Recession. In mid-2010, grads were around 7% unemployment while the workforce overall ran close to 10%, the widest that advantage ever got. Recessions gut construction and manufacturing first, sectors that lean heavily on workers without degrees, so a diploma was worth the most precisely when jobs were vanishing.
The edge vanished in 2019, before AI and before COVID
In February 2019 the gap crossed zero, and the 12-month average has stayed positive every month since. That timing rules out both of the easy explanations. The flip predates the generative-AI boom by years, and COVID by a year.
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