The job outlook for the class of 2026 is looking tougher than it has in years, according to new data. Employers are slowing down their hiring, recent graduates are finding it harder to land jobs, and competition in the workforce is growing due to automation and the hiring of foreign workers on visa programs.
A survey of 183 companies between early August and late September found that more than half—51 percent—rated the job market for new graduates as “poor” or “fair.” That’s the lowest confidence seen since the height of the COVID-19 pandemic in 2020 and 2021. Only a tiny 2 percent of employers described the outlook as excellent.
Even though hiring for new grads is expected to rise slightly by 1.6 percent, this is a big drop from previous expectations for the class of 2025. History shows these spring forecasts often end up being overly optimistic. The data reflects a sharp decline in hiring projections compared to years before, with some classes even facing shrinking opportunities.
Job postings fell by more than 16 percent in August compared to last year, based on figures from the job site Handshake. At the same time, competition grew fiercer as applications per job shot up by 26 percent. Many graduates themselves are feeling the pessimism — over 60 percent say they’re worried about their career chances.
Part of the problem is companies aren’t sure where to focus hiring with growing uncertainties around artificial intelligence and trade tariffs. At the same time, some roles that traditionally went to new graduates are now being filled by experienced professionals who were recently laid off, making it harder for fresh grads to enter the workforce.
Unemployment among recent college grads rose to 4.8 percent last June—its highest point in four years and above the national average. New grads face competition not just from each other but also from workers who lost their jobs recently and international graduates who come to the U.S. on visa programs like H-1B and Optional Practical Training (OPT).
These visa programs have become a major point of debate. Critics say they allow hundreds of thousands of foreign graduates to take jobs intended for Americans, especially in sought-after fields like STEM and business. In 2024, for example, the OPT program approved work permits for about 400,000 foreign graduates—a 45 percent increase from 2020 levels.
The Justice Department, under leadership that emphasizes protecting American workers, has promised tougher enforcement of visa laws. Officials have urged companies to be held accountable if they prioritize foreign workers over U.S. graduates, especially during this uncertain economic period.
Many Americans are frustrated. A recent poll found that 44 percent of likely voters believe companies exploit the H-1B visa system, with the strongest opposition coming from working-class voters and those without college degrees. These groups are particularly important ahead of the 2026 midterm elections.
Some also point to university admissions as part of the problem. More public universities are admitting international students on F-1 visas, many of whom later shift to work permits through OPT. Critics say this displaces American students from certain fields and increases future demand for visa-based workers.
Recent graduates like Nalin Haley are feeling the squeeze. He shared how many of his peers still haven’t found a job a year and a half after finishing college. This contrasts sharply with previous generations, where young people often secured employment right out of school.
Overall, the job market is shrinking for new grads. Rising competition, hiring cutbacks, and policy debates over visa programs are making it harder for the class of 2026 to get a good start. It’s a challenging time that requires attention from employers, policymakers, and communities alike.
