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Employers See Weak 2026 Graduate Job Market, Plan Mostly Flat Hiring

Competition for new grads is tightening due to a surge in layoffs.

Overview

  • New NACE data shows 51% of employers rate the market for the Class of 2026 as poor or fair, with about 25% planning to increase hiring, roughly 60% to maintain, and 14% to reduce.
  • Most employers say they are not replacing entry-level roles with AI in 2026 (about 60%), though 25% are unsure and 14% are discussing it, while employers report about 13% of jobs require AI skills and 10.5% of entry-level roles reference AI.
  • Entry-level opportunities have thinned, with Handshake reporting a year-over-year drop of more than 16% in August full-time postings and a 26% rise in applications per job, alongside a 35% slide in entry-level postings since January 2023 per Revelio Labs.
  • Employers have announced 1.1 million cuts so far this year, a 65% increase from last year and the highest since 2020, concentrating in sectors restructuring for AI and pressuring entry-level hiring.
  • Policy scrutiny is rising as DOJ officials pledge tougher enforcement of visa-related employment laws, while reports cite roughly 400,000 OPT work permits approved in 2024, fueling debate over impacts on recent U.S. graduates.