For much of the past decade, individuals ages 22 to 27 with at least a bachelor’s degree—classified as “recent graduates”—enjoyed a lower unemployment rate compared to the broader workforce. However, post-pandemic shifts have flipped this pattern. Since the global disruptions of COVID-19, recent grads’ jobless rate has consistently outpaced the overall unemployment rate, the institute found. In July 2025, the national unemployment rate inched up to 4.2%, but the figures were even higher among recent graduates.
The report finds that over 13% of unemployed Americans in July were “new entrants” or people seeking jobs for the first time, “which skews towards Gen Z.” This proportion has not been seen in nearly four decades, since 1988, highlighting the acute challenges younger cohorts face when beginning their careers. The report suggests that as the labor market continues to cool and economic uncertainty grows, job prospects for these groups could remain constrained, especially as the adoption of AI and global trade tensions erode entry-level opportunities.
BofA’s analysis further ties the bleak outlook for recent grads to macroeconomic headwinds, including rising global trade tensions and the rapid integration of automation in the workplace. These factors disproportionately impact younger applicants and those without lengthy work experience.
The findings emerge from an aggregation of U.S. Census Bureau and Bureau of Labor Statistics data, blended with proprietary Bank of America transaction analyses. The monthly unemployment rates used are seasonally adjusted and smoothed, focusing on Americans not currently enrolled in school.
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.
