New Graduates Navigate a Challenging Labor Market
Things are getting tough for new graduates. Job offers are drying up and the jobless rate is increasing. Are internships the answer?


To help you understand what is going on in the jobs and education sectors, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we publish many (but not all) of our forecasts a few days afterward online. Here’s the latest...
With the job market starting to cool off internships will play an even bigger role for college students in finding a job, and for employers that are trying to hire well-qualified candidates. Here are some tips for both hiring managers and job seekers navigating the tricky labor market.
Things are getting tough for new graduates. Job offers are drying up. The jobless rate among recent grads is at the highest level since 2016 — with the exception of the pandemic summer of 2020. Unemployed workers in general are finding it harder to land a new job. The number of job listings is back to its pre-pandemic normal and the amount of time spent by applicants on finding a new job is creeping up.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Internships are increasingly key to an offer. Many employers treat them as auditions, in which they get an extended look at a possible hire without a major commitment. In a crowded market, demonstrated, relevant experience via an internship often counts for a lot more than an applicant’s GPA. Firms in finance, consulting and tech in particular are likely to hire from among their prior interns. Even if a graduate doesn’t land a full-time job where they previously interned, a good track record as an intern doing related work can lead to an offer elsewhere. In one survey, 80% of employers cited internship programs as their top recruiting tool.
A sign of how key internships are: 60% of graduating seniors have done one. At the most selective colleges, the figure is more like 90%. A major benefit those schools offer is their deep networks of contacts at leading firms, and the ability to place students with them. The ability to open those doors is a valuable component of the overall experience of attending an Ivy League or other top-echelon university.
Also, note that the nature of internships is evolving. Short-term programs are gaining in popularity. They let students get their feet wet and make an impression on prospective employers, who can cycle through a lot of potential future hires with minimal commitment. Parker Dewey was founded to arrange “micro-internships,” which total less than 40 hours and pay participants $20 to $25 per hour. Another site, virtualinternships.com, sets up online gigs for students looking to work at foreign firms.
For employers considering hiring interns, whether to pay is a major decision. Unpaid programs are OK but should meet certain criteria to not run afoul of labor laws. For starters, there must be a clear benefit to the intern, in the form of gaining skills and experience (and often, academic credit from their university), and it should be clear up front that the work is unpaid. Still, paid internship programs will naturally draw more and better applicants, likely leading to better performance while the program lasts, and a bigger pool of qualified applicants for full-time jobs.
This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

David is both staff economist and reporter for The Kiplinger Letter, overseeing Kiplinger forecasts for the U.S. and world economies. Previously, he was senior principal economist in the Center for Forecasting and Modeling at IHS/GlobalInsight, and an economist in the Chief Economist's Office of the U.S. Department of Commerce. David has co-written weekly reports on economic conditions since 1992, and has forecasted GDP and its components since 1995, beating the Blue Chip Indicators forecasts two-thirds of the time. David is a Certified Business Economist as recognized by the National Association for Business Economics. He has two master's degrees and is ABD in economics from the University of North Carolina at Chapel Hill.
-
Stock Market Today: Have We Seen the Bottom for Stocks?
Solid first-quarter earnings suggest fundamentals remain solid, and recent price action is encouraging too.
By David Dittman
-
Is the GOP Secretly Planning to Raise Taxes on the Rich?
Tax Reform As high-stakes tax reform talks resume on Capitol Hill, questions are swirling about what Republicans and President Trump will do.
By Kelley R. Taylor
-
The Economic Impact of the US-China Trade War
The Letter The US-China trade war will impact US consumers and business. The decoupling process could be messy.
By David Payne
-
AI Heads to Washington
The Kiplinger Letter There’s big opportunity for AI tools that analyze MRIs and other medical images. But also big challenges that clinicians and companies will have to overcome.
By John Miley
-
The AI Doctor Coming to Read Your Test Results
The Kiplinger Letter There’s big opportunity for AI tools that analyze CAT scans, MRIs and other medical images. But there are also big challenges that human clinicians and tech companies will have to overcome.
By John Miley
-
The New Space Age Takes Off
The Kiplinger Letter From fast broadband to SOS texting, space has never been more embedded in peoples’ lives. The future is even more exciting for rockets, satellites and emerging space tech.
By John Miley
-
Rising AI Demand Stokes Undersea Investments
The Kiplinger Letter As demand soars for AI, there’s a need to transport huge amounts of data across oceans. Tech giants have big plans for new submarine cables, including the longest ever.
By John Miley
-
What DOGE is Doing Now
The Kiplinger Letter As Musk's DOGE pursues its ambitious agenda, uncertainty and legal challenges are mounting — causing frustration for Trump.
By Matthew Housiaux
-
A Move Away From Free Trade
The Letter President Trump says long-term gain will be worth short-term pain, but the pain could be significant this year.
By David Payne
-
The Explosion of New AI Tools
The Kiplinger Letter Workers and consumers soon won’t be able to escape generative AI. Does that mean societal disruption and productivity gains are right around the corner?
By John Miley