Nearly six in ten recent university graduates are finding it “very challenging” to secure full-time, entry-level positions this year, with many pointing to artificial intelligence as a key factor reshaping the job market, according to new research from Indeed Flex.
The comprehensive survey of nearly 1,200 recent graduates reveals a stark reality: only 9% found entry-level employment easily, while the vast majority face an increasingly competitive and contracted job market.
The Perfect Storm: Experience, Competition, and AI
Recent graduates are battling multiple barriers to employment. A quarter (25%) cite lack of experience as their primary challenge, while 24% point to excessive competition for available roles.
However, it’s the perceived threat of artificial intelligence that’s causing the most concern among new job seekers. A striking 79% of respondents believe AI is actively reducing the number of entry-level positions in their chosen fields.
Survival Strategies: Flexibility Over Dreams
Faced with these challenges, graduates are fundamentally changing their approach to job hunting, prioritising financial security over career aspirations:
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Money Over Dreams: Nearly half (49%) are now open to any job that pays well, regardless of whether it aligns with their career goals.
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Embracing Temporary Work: 46% report that AI concerns have led them to consider temporary or flexible employment instead of traditional full-time roles.
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Diversifying Job Search: Graduates are casting wider nets, with 20% actively seeking remote or freelancing opportunities, 17% pursuing temporary or seasonal work, and 13% exploring gig or contract-based employment.
The Skills Gap Dilemma
While graduates recognise AI’s growing influence over employment prospects, there’s a significant disconnect between awareness and preparation. More than half (54%) have received no formal training or upskilling in AI-related tools or knowledge.
Some are taking matters into their own hands, with 22% reporting they’ve self-taught their current AI expertise, highlighting a gap between university curricula and market demands.
Industry Response
Novo Constare, CEO and Co-founder of Indeed Flex, acknowledges the challenging landscape facing new graduates.
“We empathise with the challenges recent grads are facing in this tight job market,” Constare explained. “At the moment, temporary work is helping people make ends meet and also gives them flexibility to navigate their difficult job search.”
Looking Forward
The research, conducted in August 2025 across the US and UK, paints a picture of a generation adapting to unprecedented changes in the employment landscape. With 87% of respondents having graduated within the last two years, and 40% within the last six months, these findings represent the most current snapshot of graduate employment challenges.
As AI continues to reshape industries, the data suggests that traditional career paths may be evolving, with flexibility and adaptability becoming essential skills for new graduates navigating an uncertain job market.
The implications extend beyond individual career prospects, potentially signalling a fundamental shift in how the next generation approaches work and career development in an AI-driven economy.