It seems that in 2025, those dreams are falling flat.

According to the most recent data published by the Federal Reserve Bank of St Louis (FRED), the unemployment rate for college graduates with a bachelor’s degree sat at 6.1% in May—up from 4.4% just a month prior.

Likewise, the unemployment rate for those aged between 20 and 24 with some college experience but no degree, as well as those of the same age demographic with a Master’s degree or higher, spiked last month.

FRED reports that Gen Z with a Master’s or higher now have an unemployment rate of 7.2% while those with some college experience have an unemployment rate of 9.4%.

According to analysis by the Wall Street Journal, that picture is even more dire. Citing micro data from the Labor Department, the WSJ estimates graduates have an unemployment rate of 6.6% over the past 12 months ending in May, the highest level in a decade with the exception of the pandemic spike.

This trend of increasing unemployment is at odds with the picture of the rest of the U.S., where unemployment held steady at 4.2% from April to May, elevated only a little from the rate 12 months ago.

It’s perhaps no surprise then that the graduates who do land entry-level jobs tend to stay in them, for fear of being stuck in a stagnant market. Meanwhile grads who didn’t land a role find it difficult to get a foot onto the career ladder.

As researchers from Oxford Economics reflected in a study last month: “Those in the professional, scientific, and technical services are less likely than their peers to seek employment in a different industry, though they are more likely to accept underemployment—defined as a college graduate who is employed in a job where more than 50% of workers in the same role do not have a bachelor’s degree or higher.”

Indeed, while some young potential staffers are willing to take sideways steps in order to earn an income, the analysts suggested Gen Z grads are having a harder time than most: “The upshot is that the unemployment rate for recent college graduates will remain elevated in the near term without a surge in demand from tech companies or a mass exodus from the labor force by these individuals, both of which seem unlikely.

“While these workers only account for around 5% of the workforce, they have played an oversize role in pushing the national unemployment higher.”

Alternative routes

An argument could be made that the data suggests employers aren’t finding the skills they need in newly-minted grads, despite the tens of thousands of dollars many will have forked out to achieve their degrees.

JPMorgan CEO Jamie Dimon, for example, has pushed for education reform to rank schools based on whether its students land jobs as opposed to how many of them get into college.

“If you look at kids they gotta be educated to get jobs. Too much focus in education has been on graduating college… It should be on jobs. I think the schools should be measured on, did the kids get out and get a good job?” Dimon told Indianapolis-based WISH-TV last year.

The idea that college is the only way to land a well-paid job is also inaccurate, he added, saying 17-year-old bank tellers can take home $40,000 a year “and if you happen to have a family at 18 or whatever, you get $20,000 in medical benefit for your family. You can be a welder, you can be a coder, you could be cyber, you could be automotive—all of those jobs are $40,000 to $60,000, $70,000 a year.”

Dimon, a veteran of Wall Street, has also argued educators should focus on skills which will stand individuals in good stead for the rest of their lives such as nutrition and financial literacy.

The JPMorgan Chase boss isn’t alone. In a WSJ op-ed last year titled “Not Everyone Needs a College Degree” the CEOs of Home Depot and Walmart U.S., Ted Decker and John Furner wrote: “Young people have been told for decades that achieving the American dream requires a college degree … While a college degree is a worthwhile path to prosperity, it isn’t the only one.”

They added: “The American dream isn’t dead, but the path to reach it might look different for job seekers today than it did for their parents. We owe it to younger generations to open our minds to the different opportunities workers have to learn new skills and achieve their dreams.”