TL;DR: This article examines how artificial intelligence, corporate restructuring, and shifting labor market demands are rapidly diminishing the value of a college degree as a reliable path to professional employment.
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📺 Title: How AI Is Killing The Value Of A College Degree
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👤 Channel: CNBC
🎯 Topic: Killing Value College
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In May 2025, a Villanova graduate stood ready to don their cap and gown, surrounded by family and friends who had traveled from across the country to celebrate a hard-earned milestone. Full of optimism and pride, they envisioned stepping into the professional world with confidence—only to face a job market that had turned hostile to new talent. This is not an isolated story. It’s a national trend rooted in what experts now call the “Killing Value College” phenomenon: the rapid erosion of the bachelor’s degree as a reliable pathway to stable, professional employment.
This comprehensive guide unpacks the full scope of this crisis—from personal testimonies and labor market data to the disruptive role of artificial intelligence (AI), corporate restructuring, and policy implications. Every insight, statistic, and recommendation from the original transcript is preserved and expanded into actionable knowledge for students, graduates, job seekers, and policymakers alike.
The Graduation High and the Job Search Crash
On May 16, 2025, a recent Villanova graduate described feeling “on top of the world,” eager to apply four years of academic rigor to a meaningful career. Family members—Michael, Sean, Mathias—gathered to witness the ceremony, symbolizing the collective investment in higher education as a ticket to independence and success.
Yet just months later, that optimism gave way to frustration. Despite beginning their job search as early as November 2024, the graduate struggled to secure even initial interviews. “It’s been a little demoralizing,” they admitted. “The job market is kind of trash right now.” This emotional whiplash—from celebration to stagnation—captures the lived reality of thousands of 2025 graduates confronting a labor market that no longer rewards credentials alone.
Youth Unemployment: A Warning Sign for the Economy
While overall U.S. unemployment remains low, a stark divergence emerges when examining young workers. The unemployment rate for Americans aged 16 to 24 stood at 10.4% in September 2025, trending upward since April 2023—the lowest post-pandemic point.
More alarming is the surge in unemployment among recent college graduates, a group historically considered among the “safest” in the labor market. Economists warn this isn’t just a personal hardship—it’s an economic red flag. “Graduating in a recession leaves long-lasting scars for decades,” experts note. These young workers are vital to labor force dynamism, innovation, and consumer spending. Their exclusion signals deeper systemic issues.
Economic Ripple Effects of Youth Joblessness
The consequences extend far beyond individual disappointment:
- Reduced consumer spending: Unemployed grads delay major purchases (cars, homes) and cut discretionary spending.
- Lower lifetime earnings: Early-career unemployment depresses income trajectories for 10–15 years.
- Declining tax revenue: Fewer employed young workers mean less income and payroll tax contribution.
- Widening inequality: As the Oxfam report shows, from 1989 to 2022, the top 1% gained 101 times more wealth than the median household. Youth unemployment accelerates this divide.
The “Killing Value College” Phenomenon Explained
For the first time in modern history, a bachelor’s degree is no longer a reliable path to professional employment. This shift—dubbed “Killing Value College”—stems from two converging forces:
- Surging supply: More young people than ever are earning degrees, far outpacing demand.
- Stagnant or declining demand: Employers, especially in tech and corporate sectors, are hiring fewer bachelor’s-degree holders due to automation and AI.
The result? A glut of college graduates competing for shrinking entry-level roles, leading to slower wage growth and prolonged underemployment.
AI’s Disproportionate Impact on Entry-Level Roles
Artificial intelligence isn’t just changing work—it’s eliminating the traditional on-ramp for new talent. According to a Stanford study, unemployment among 22- to 25-year-olds in highly AI-exposed jobs has increased by 13% since 2022, while older workers in less exposed roles remain stable or grow.
“AI and machine learning is absolutely taking entry-level careers from new graduates like myself,” shared the Villanova graduate. From a business perspective, this makes sense: AI tools can produce results faster and cheaper than junior hires.
Case Study: Tech’s Shrinking Junior Workforce
Nowhere is this trend clearer than in the technology sector:
- AI systems that write code—especially at the junior level—have become highly capable.
- As a result, “the need for a number of junior engineers has gotten lower.”
- A Pave compensation platform study found that between January 2023 and July 2025, the number of young workers at large public tech companies fell by more than half. Private tech firms also saw significant declines.
Corporate Restructuring and the AI Pivot
Major corporations are actively reshaping their workforces to prioritize AI investment. Amazon, for example:
| Year | Global Workforce | Key Event |
|---|---|---|
| 2021 | 1.6 million | Pandemic-era hiring spree |
| 2024 | 1.5 million | Post-pandemic contraction begins |
| 2025 | ↓ 14,000 corporate layoffs | Restructuring for AI era; shift toward generative AI |
Amazon’s 2025 layoffs are explicitly tied to its “multiyear effort to streamline operations and shift resources toward its biggest bets, including generative AI.” This pattern repeats across finance, media, and customer service sectors.
Is Overhiring to Blame? Experts Are Divided
Some argue that pandemic-era hiring sprees—driven by fear of labor shortages—created bloated workforces now being corrected. However, others counter that these adjustments largely concluded by 2023–2024.
“We are now November 2025. I think it’s no longer a big impact,” noted one analyst. Instead, a more enduring factor is at play: the permanent shift in operational efficiency.
The Labor Shortage Legacy
The severe labor shortages of 2021–2023 forced companies to “learn how to do things with fewer people”—even before AI became mainstream. This cultural and operational shift persists, reducing the baseline need for new hires regardless of economic conditions.
Federal Reserve and Corporate Hiring Freezes
The Federal Reserve is closely monitoring the trend. “You see a significant number of companies either announcing that they are not going to be doing much hiring, or actually doing layoffs,” officials report. Frequently, executives cite AI capabilities as justification.
This signals a structural—not cyclical—change in hiring behavior, particularly for entry-level positions once seen as training grounds for future leaders.
The New Entry-Level Requirement: AI Fluency
Paradoxically, while AI eliminates some roles, it creates demand for others—specifically, for grads who can use AI effectively. According to Handshake, the leading career platform for college students and recent graduates:
| Metric | 2023 | 2025 | Change |
|---|---|---|---|
| Job postings requiring AI skills | Baseline | 5x increase | +400% |
| Internships requiring AI skills | Baseline | 4x increase | +300% |
Employers now expect early-career talent to be “familiar and comfortable using AI” and to “balance both their expertise and knowledge, as well as productivity and efficiency.”
How Graduates Can Adapt: Embracing AI Literacy
Experts urge young job seekers not to fear AI—but to master it. Key strategies include:
- Learning prompt engineering: Knowing how to craft effective prompts improves output quality.
- Using multiple generative AI systems: Different tools excel at different tasks (e.g., coding, writing, data analysis).
- Developing AI-augmented workflows: Combine human creativity with AI efficiency to deliver higher-value results.
“Learning how to use the tools will make them stand out,” says one career advisor. “AI doesn’t replace smart, creative people—it empowers them.”
The Undiminished Power of Networking
Even in an AI-driven market, human connections remain irreplaceable. Career experts emphasize:
“If you’re someone who’s graduating right now and you haven’t done internships… or built connections with professionals, you need to hurry up and get on that.”
Why? Because personal relationships often bypass automated application systems. A former internship supervisor who “remembers you and had a good experience” can fast-track your resume or even create a role.
Action Steps for Building Professional Networks
- Reach out to alumni from your university on LinkedIn.
- Attend industry meetups, virtual or in-person.
- Request informational interviews—ask for advice, not jobs.
- Follow up consistently and offer value (e.g., share relevant articles).
Long-Term Economic and Political Consequences
Sustained youth unemployment doesn’t just hurt individuals—it destabilizes society. Economists warn of:
- Deepening income inequality: With fewer entry points into the middle class, wealth concentrates at the top.
- Political disillusionment: Young workers may grow “dissatisfied with the current economy and political climate.”
- Demand for redistribution: Rising inequality could fuel calls for universal basic income, wealth taxes, or expanded social safety nets.
“It will be a problem that will have political consequences,” one analyst predicts. Policymakers must act now to avoid a lost generation.
Corporate Giants and AI-Driven Workforce Reduction
Goldman Sachs estimates that AI could displace 6–7% of the U.S. workforce over the next decade. While some roles vanish, others transform—but the net effect skews negative for new entrants.
Corporate giants are leading this shift. By integrating automation, they reduce headcount while maintaining or increasing output. This efficiency gain comes at the cost of opportunity for inexperienced workers.
Hope on the Horizon: Resilience in the Face of Adversity
Despite the challenges, there is reason for optimism. “I have a lot of hope going forward for the job market,” said the Villanova graduate. “Hard times create strong people.”
This cohort of graduates—forged in economic uncertainty—may develop unparalleled resilience, adaptability, and work ethic. They are less likely to “take their jobs for granted” and more likely to innovate within constraints.
Action Plan for 2025 Graduates: Navigating the Killing Value College Era
To thrive in this new landscape, follow this comprehensive strategy:
- Audit your AI skills: Can you use ChatGPT, Claude, GitHub Copilot, or industry-specific AI tools effectively?
- Add AI projects to your portfolio: Showcase how you’ve used AI to solve real problems.
- Target AI-fluent employers: Use Handshake and LinkedIn to find companies actively seeking AI-literate talent.
- Reconnect with past contacts: Reach out to professors, internship supervisors, and alumni.
- Consider alternative paths: Freelancing, micro-internships, or upskilling in high-demand niches (e.g., AI ethics, prompt engineering).
Conclusion: Reclaiming the Value of College in the AI Age
The “Killing Value College” trend is real—but not irreversible. While the bachelor’s degree alone no longer guarantees employment, it remains a foundation. When combined with AI fluency, strategic networking, and real-world experience, it can still unlock opportunity.
The key is adaptation. The graduates who succeed in 2025 and beyond won’t just have diplomas—they’ll have the agility to leverage technology, the humility to learn continuously, and the courage to build relationships in a digital-first world.
As one optimist put it: “This is just a little bit of a difficult time… but ultimately, those new graduates are going to become stronger people.” And in that strength lies the future of work.
