Young and unemployed? Study shows that home office can be more of a problem than AI

Connor Scott, 24, and Zoe Lloyd, 21, study at a local coffee shop and restaurant on April 20, 2026, in Flagstaff, Arizona.
AP/Cheyanne Mumphrey
The increase in remote work since the pandemic has made companies more reluctant to hire young people with no experience, and that is the main factor behind higher unemployment rates among recent graduates, according to a study released on Monday (1).
The research, carried out by the Federal Reserve Bank of New York, compared professions that can be performed remotely - such as software development - with in-person occupations, such as nursing.
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The research concluded that the unemployment rate among young people recently graduated in "remote" jobs rose by around 1 percentage point between the periods 2017-2019 and 2022-2024.
Among older workers in these areas - aged 29 or over - the unemployment rate fell slightly, widening the gap between young people and more experienced professionals in remote occupations.
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In professions that do not allow remote work, however, there was little difference in unemployment rates between younger and older graduates, according to the study. A similar pattern was also observed among workers without a college degree.
The research, led by New York Fed economist Natalia Emanuel, concludes that companies avoid hiring recent graduates for remote positions because it is more difficult to train and mentor them outside of the in-person environment.
"Remote work has weakened incentives to hire young workers by making on-the-job training more difficult," the study states. "Employers may not want to hire recent graduates into distributed teams because it is more difficult to teach them the necessary skills remotely."
The study comes amid growing concern about the job prospects for young graduates, as artificial intelligence advances across a range of office professions, including finance, law, entertainment and media. This semester, graduates even booed references to AI during graduation speeches.
But the survey highlights that the worsening of the job market for young graduates began before the popularization of artificial intelligence tools such as ChatGPT. And, when analyzing the degree of exposure of different professions to AI, the researchers concluded that the technology had little impact on youth unemployment.
The unemployment rate among college graduates under the age of 29 rose 20% compared to the pre-pandemic period, reaching an average of 3.7% between 2022 and 2025, according to the New York Fed. Among graduates aged 22 to 27, unemployment reached 5.8% last year - the highest level outside the pandemic period since 2012.
The study's conclusions reinforce the current job market scenario, marked by few hires and few layoffs: although layoffs remain low and unemployment relatively stable, those who lose their jobs have found it more difficult to find a new position.
The study also analyzed detailed data from a Fortune 500 technology company, unidentified, and found that its hiring patterns reflected the trend observed in the overall data.
When offices were closed and employees worked remotely, "the company hired fewer inexperienced workers and more experienced professionals, who likely needed less guidance to perform their roles well," the study says.
"Once offices reopened, the company began hiring more young workers again," the research says. Still, even after reopening, the company continued to favor more experienced professionals for teams that maintained some level of remote work.
Empty desks in an office building in the borough of Manhattan, New York, on August 2, 2024.
AP/Ted Shaffrey

Source: G1