US Hiring Rebounds in March as College Grads Adjust Expectations

Unemployment rate ticks down as employers add 178,000 jobs, but concerns over AI and job security linger for new graduates

Apr. 3, 2026 at 12:35pm

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A minimalist, abstract illustration using bold geometric shapes and primary colors to conceptually represent the shifting dynamics of the US job market and the evolving expectations of new college graduates.As the US job market rebounds, new college graduates adjust their expectations, seeking greater job security amid concerns over AI's impact on entry-level roles.NYC Today

The U.S. economy added 178,000 jobs in March, exceeding forecasts, as striking healthcare workers returned to work. However, new college graduates are adjusting their expectations, with more willing to accept lower-paying roles for greater job security amid concerns over AI replacing entry-level positions. The unemployment rate for recent grads aged 22-27 rose to 5.7% in Q4 2025, with underemployment also increasing.

Why it matters

The job market's rebound and shift in graduate expectations provide insight into the evolving labor landscape, as employers navigate economic uncertainty, the impact of AI, and the needs of a new generation entering the workforce.

The details

The U.S. economy added 178,000 jobs in March, a significant increase from the 133,000 jobs lost in February. The return of about 31,000 striking Kaiser Permanente healthcare workers accounted for some of the rebound. The unemployment rate ticked down to 4.3% in March from 4.4% in February. However, the unemployment rate for recent college graduates aged 22-27 rose to 5.7% in Q4 2025, up from 5.3% in the prior quarter. Underemployment for this age group also increased, reaching 42.5% - the highest level since 2020. Graduates are now more willing to accept lower-paying roles for greater job security, with 67% saying they would do so, up from 64% last year. This shift comes as 89% of graduates worry that AI could replace entry-level positions, up from 64% in 2025.

  • The U.S. added 178,000 jobs in March 2026.
  • The unemployment rate for recent college grads aged 22-27 stood at 5.7% in Q4 2025, up from 5.3% in the prior quarter.
  • Federal Reserve Chair Jerome Powell spoke to Harvard University students on March 30, 2026.

The players

Vicki Salemi

A career expert at Monster, who noted that young people are worried about being the "last one in, first one out" of their new jobs due to corporate layoffs.

Jerome Powell

The Federal Reserve Chair, who acknowledged the challenges facing young people entering the labor market amid low job creation and the rise of AI adoption, but expressed optimism about the long-term outlook.

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What they’re saying

“They do not want to be 'the last one in, first one out' of their new job.”

— Vicki Salemi, Career expert at Monster

“The unemployment rate is really low, but that doesn't help you if you're coming into that kind of market. Invest the time to really master the use of these new technologies, and that should stand you in good stead, but there's no denying it's a challenging time to enter the labor market.”

— Jerome Powell, Federal Reserve Chair

What’s next

Federal Reserve Chair Jerome Powell is expected to provide further insights on the labor market and the challenges facing new graduates during his upcoming testimony before Congress.

The takeaway

The rebound in hiring and shift in graduate expectations highlight the evolving dynamics of the US job market, as employers navigate economic uncertainty, the impact of AI, and the needs of a new generation entering the workforce. While the overall labor market remains strong, concerns over job security and the ability to find roles that align with their values continue to weigh on recent college graduates.