A shortage of job openings in the US is playing a much bigger role in young people’s unemployment than their lack of artificial intelligence skills, according to a new study from the Federal Reserve Bank of St. Louis.
The unemployment rate among 18- to 24-year-olds rose 2.9 percentage points between April 2023 and December of last year because of a lack of job openings. That’s more than double the 1.1-point increase seen from employers shifting to more AI-related jobs and demanding specialized skills, though the AI effect remains significant.
“Since April 2023, hiring has slowed, and young workers, especially new entrants, have borne the brunt of that softening,” authors William Rodgers III and Alice Kassens wrote. “AI adds an additional headwind at the point of labor market entry, particularly for recent college graduates, but its effects remain smaller than those of the broader decline in job openings.”
