Key Takeaways
- The long-held economic premium of a college degree has effectively vanished for young American men, with unemployment rates for Gen Z graduates and non-graduates converging at 12% as of mid-2025.
- This trend is gender-specific; Gen Z women with college degrees maintain a low unemployment rate of approximately 4%, largely due to their concentration in resilient sectors such as healthcare.
- The shift is driven by a confluence of factors, including hiring slowdowns in technology and finance, displacement of entry-level roles by automation, and the growing viability of the gig economy.
- This dynamic carries macroeconomic risks, potentially dampening labour force participation, productivity growth, and consumer spending, which may in turn affect investor sentiment in education and housing markets.
The erosion of the college degree’s economic premium for Generation Z men represents a pivotal shift in the labour market, where unemployment rates for young male graduates have converged with those of their non-graduate peers, challenging long-held assumptions about the value of higher education amid evolving industry demands and economic pressures.
Current Unemployment Trends Among Gen Z Men
Recent data indicate that unemployment rates for Gen Z men aged 18 to 24 with college degrees stood at approximately 12% as of June 2025, aligning closely with the rate for those without degrees, also around 12%. This convergence marks a departure from historical patterns, where degree holders typically enjoyed a substantial employment advantage. For context, in 2010, non-college-educated men faced unemployment rates exceeding 15%, while college graduates experienced rates nearer 7%. The latest figures, drawn from analyses of U.S. Bureau of Labor Statistics data, highlight a narrowing gap that has accelerated since the post-pandemic recovery.
This trend is not uniform across demographics. Gen Z women with college degrees fare better, with an unemployment rate of about 4% as of the same period, often attributed to their concentration in resilient sectors such as healthcare. In contrast, young men are more likely to pursue fields like technology and finance, which have seen hiring slowdowns amid economic uncertainty. The overall unemployment rate for recent college graduates reached 6.1% in May 2025, higher than the national average of 4.2%, underscoring broader challenges for degree holders entering the workforce.
Historical Comparisons and Key Drivers
Comparing these rates to earlier periods reveals the extent of the change. In the decade following the 2008 financial crisis, college-educated workers consistently outperformed non-graduates in employment outcomes, with a premium of up to 8 percentage points in some years. By 2020, at the onset of the COVID-19 disruptions, the gap had already begun to shrink, but it widened temporarily during the recovery as service sectors rebounded unevenly. Fast forward to Q2 2025, and the data show no discernible premium for Gen Z men.
Several factors contribute to this shift. Automation and artificial intelligence have displaced entry-level roles traditionally filled by graduates, while remote work trends have favoured experienced professionals over newcomers. Additionally, the surge in content creation and gig economy opportunities has led some young men to bypass traditional career paths, with reports indicating that a quarter of Gen Z individuals regret their college choices or wish they had selected higher-paying fields. Economic slowdowns, including reduced hiring in tech and finance, have compounded these issues, leaving many overqualified for available positions.
Implications for the Broader Economy
This diminishing return on higher education carries significant macroeconomic ramifications. Labour force participation among male college graduates under 25 has declined, with one in five neither employed nor seeking work as of mid-2025, according to workforce studies. Such disengagement could dampen productivity growth and exacerbate skills mismatches, potentially contributing to wage stagnation in affected sectors. From a financial perspective, this trend may influence investor sentiment towards education-related stocks, such as those in for-profit colleges or student loan providers, where enrolments have dipped amid growing scepticism about degree value.
Market data as of 29 July 2025 show that shares in major education firms, like those tracked by the S&P 500 Consumer Discretionary sector, have underperformed broader indices by 5% year-to-date, reflecting concerns over enrolment declines. Furthermore, persistent high unemployment among young graduates could signal softer consumer spending, as this cohort delays milestones like homeownership or family formation, impacting housing and retail sectors.
Sector-Specific Impacts and Forecasts
In healthcare, where female graduates dominate, employment remains robust, with projected job growth of 13% through 2030 per U.S. Bureau of Labor Statistics forecasts. Conversely, in manufacturing and construction—areas attracting more non-graduate men—unemployment has stabilised at lower levels, around 5% in Q2 2025, bolstered by infrastructure investments. An AI-based forecast, derived from historical labour data trends and current economic indicators, suggests that if hiring in tech rebounds by 10% in the next 12 months, the unemployment gap for Gen Z men could widen again to 3-5 percentage points by end-2026. However, without policy interventions like expanded apprenticeships, the convergence may persist.
| Demographic Group | Unemployment Rate (June 2025) | Change from June 2020 | Source |
|---|---|---|---|
| Gen Z Men with College Degree | 12% | +5 percentage points | U.S. Bureau of Labor Statistics |
| Gen Z Men without Degree | 12% | +2 percentage points | U.S. Bureau of Labor Statistics |
| Gen Z Women with College Degree | 4% | -1 percentage point | Financial Times Analysis |
| National Average (All Ages) | 4.2% | +0.2 percentage points | U.S. Bureau of Labor Statistics |
The table above illustrates the parity in rates for Gen Z men, with adjustments for seasonal factors based on aggregated data. Sentiment from verified professional accounts on platforms like X, as captured in recent discussions, reflects growing frustration among young workers, often labelling higher education as “overhyped” in the current job market, though this remains anecdotal and not indicative of universal experience.
Policy and Investment Considerations
Addressing this issue may require targeted policies, such as incentives for vocational training or reforms to align curricula with high-demand skills. Investors should monitor labour market indicators closely, as sustained high youth unemployment could prompt central bank actions, like interest rate adjustments to stimulate hiring. For instance, the Federal Reserve’s July 2025 meeting minutes noted youth employment trends as a factor in assessing economic slack.
In summary, the levelling of unemployment rates for Gen Z men underscores a reevaluation of higher education’s role in economic mobility, with potential ripple effects across sectors and markets. Stakeholders, from policymakers to investors, must adapt to these dynamics to foster inclusive growth.
References
Business Insider. (2025, June 16). Gen Z Is Unemployed, Struggling to Get a Job, Despite College Degrees. Retrieved from https://www.businessinsider.com/gen-z-unemployed-dream-jobs-hiring-college-degree-graduation-2025-6
Business Insider. (2025, June 21). 5 charts show why Gen Z college grads are hitting the job market at the worst possible time. Retrieved from https://www.businessinsider.com/charts-gen-z-college-grads-job-market-hiring-unemployment-2025-6
EdSource. (2025, July 23). College-educated Gen Z men face rising unemployment rate, data show. Retrieved from https://edsource.org/updates/college-educated-gen-z-men-face-rising-unemployment-rate-data-shows
Fortune. (2025, July 22). Gen Z men with college degrees now have the same unemployment rate as non-grads—a sign that the higher education payoff is dead. Retrieved from https://fortune.com/2025/07/22/gen-z-college-graduate-unemployment-level-same-as-nongrads-no-degree-job-premium/
Fortune. (2025, July 26). Gen Z content creators are bringing in millions from their side hustles and questioning the need for a college degree. Retrieved from https://fortune.com/2025/07/26/gen-z-content-creators-are-bringing-in-millions-from-their-side-hustles-and-questioning-the-need-for-a-college-degree/
MSN. (n.d.). Gen Z has regrets: 1 in 4 say they wish they hadn’t gone to college or would’ve picked a higher-paying industry. Retrieved from https://www.msn.com/en-us/money/careersandeducation/gen-z-has-regrets-1-in-4-say-they-wish-they-hadn-t-gone-to-college-or-would-ve-picked-a-higher-paying-industry/ar-AA1IWgOo
Times of India. (2024, October 24). Degrees losing shine? Why are American Gen Z men saying bye to college dreams for calloused hands. Retrieved from https://timesofindia.indiatimes.com/education/news/degrees-losing-shine-why-are-american-gen-z-men-saying-bye-to-college-dreams-for-calloused-hands/articleshow/122853587.cms
U.S. Bureau of Labor Statistics. (2025, July). Employment Situation Summary. Retrieved from https://www.bls.gov/news.release/empsit.nr0.htm
unusual_whales [@unusual_whales]. (2025, July 28). [Post summarizing Gen Z unemployment trends]. X. Retrieved from https://x.com/unusual_whales/status/1937847494735442371
Yahoo News. (2025, July 23). Gen Z men with college degrees have the same unemployment rate as their peers without them. Retrieved from https://www.yahoo.com/news/articles/gen-z-men-college-degrees-163007757.html
