The July 2025 edition of NC Economy Watch, presented by the Labor & Economic Analysis Division (LEAD) of the North Carolina Department of Commerce, highlights the current challenges faced by recent college graduates in the state’s labor market. Despite college education being a valuable investment for most students, new graduates are encountering a tougher job market compared to previous years. This is attributed to technological changes and fluctuations in the post-COVID economy.
Media outlets have extensively covered these issues. CBS News reports on the “Rising number of college grads are unemployed,” while the Wall Street Journal notes that “Young Graduates Are Facing an Employment Crisis.” Forbes magazine questions whether “Entry-Level Jobs” are disappearing.
Although the national unemployment rate remains below 5%, and Federal Reserve Chair Jerome Powell describes labor market conditions as “solid,” hiring rates have dropped to their lowest point in over a decade. This situation presents difficulties for jobseekers, particularly those newly entering the workforce after graduation.
Data from NC TOWER indicates that graduates with bachelor’s degrees from North Carolina’s state university system are experiencing wage declines. The class of 2023 saw a median first-year salary drop to around $32,000 from $34,000 for the class of 2022. This marks one of the largest declines outside a recession over two decades.
Graduates with majors in Computer & Information Sciences & Support Services experienced significant wage reductions as tech companies reduced headcounts following a hiring surge during COVID-19. While earnings decreased across various fields like engineering and business, health-related majors saw wage growth due to increasing demand driven by an aging population.
The underlying causes of these challenges remain debated. Some view them as cyclical, tied to normal economic fluctuations, while others suggest they may be structural and permanent. The demand for college-educated workers appears to be slowing, with technological advancements potentially reducing this need further.
Despite these challenges, college education continues to provide access to many high-paying jobs in North Carolina. However, as employer demands evolve alongside economic changes, valued degrees and majors might shift accordingly.
Inquiries regarding this report can be directed to Meihui Bodane, Assistant Secretary for Policy, Research and Strategy at LEAD via mbodane@commerce.nc.gov.
