Recent College Grads Are Discovering That a STEM Degree Doesn't Guarantee a Stable Job

Degrees in science, technology, engineering and mathematics, aka STEM, have long been championed as tickets to high-paying, stable jobs. But that’s starting to change, according to the latest employment numbers from the Federal Reserve Bank of New York.

Several staple STEM degrees, such as physics, computer engineering and chemistry, are increasingly leaving recent graduates, defined as those aged 22 to 27, without jobs. Data from the NY Fed show that national unemployment rates for many of those degrees are far worse than the average unemployment rate for all recent grads — as well as the unemployment rate for all young workers, regardless of education.

The unemployment rate for graduates with physics degrees, for example, is 7.8%, marking the second worst-performing degree out of the NY Fed’s analysis of more than 70 popular degrees. The degree with the highest unemployment rate for graduates was anthropology, at 9.4%.

Computer engineering was the third worst, with a graduate unemployment rate of 7.5%.

By comparison, the average unemployment rate for recent grads of all majors in the analysis was 3.9%. The national unemployment rate for young workers of all education levels is 6.9% as of March.

Are STEM degrees losing their luster?

High unemployment rates among recent STEM graduates are a fairly new phenomenon. According to NY Fed data from last year, the degrees with the highest share of unemployed graduates could have been the butt of a predictable joke: art history (8%), liberal arts (7.9%) and fine arts (7.9%).

But cracks in STEM supremacy were beginning to emerge. A couple STEM majors in 2024 appeared among the 10 degrees with the highest unemployment rates for young grads, with aerospace engineering and physics reporting rates above 6%.

Now in a stark reversal, art history grads are far more likely to be employed than computer-engineering, mathematics, chemistry, industrial-engineering and physics majors.

To be sure, many STEM majors, especially in the field of engineering, produce some of the highest-paid graduates. Take aerospace engineering, for example. Graduates age 35 to 45 typically earn $125,000, the highest among all majors, according to the NY Fed. And the highest starting wage for recent grads is $80,000, for chemical engineers.

Likewise, STEM majors are less likely to be underemployed than liberal arts majors, meaning they typically do not end up in jobs that don’t require a college degree. Still, it’s starting to look like some letters in STEM are more valuable than others.

Separate data from the National Association of Colleges and Employers (NACE) suggests that it’s getting more difficult for computer- and physical-science majors to land jobs after graduation.

In 2014, the first year NACE began tracking job outlooks by major, only 6.1% of computer engineering majors said they were still looking for full-time employment six months after graduation, while about 80% were already employed. Jump to 2023, the latest survey, and it’s a much different picture: 13.7% are looking for jobs, while only 64% are employed full time.

Over that same period, all college graduates faced a drop in full-time employment with a higher share looking for work, but the change in employment prospects was particularly pronounced for certain STEM majors.

In the age of AI, 'liberal arts can be very valuable’

What’s behind the trend could, in part, be due to a saturation of STEM majors flooding the job market.

According to a Money analysis of Education Department data, the number of STEM degrees colleges have awarded over the past decade has increased by about 34% with growth peaking in 2016 and slowing to a trickle over the past few years.

Another theory is one multibillionaire Mark Cuban has been warning about for years. In interviews dating back to 2017, Cuban has been warning about the impact of artificial intelligence and automation on STEM jobs.

"I personally think there's going to be a greater demand in 10 years for liberal arts majors than there were for programming majors and maybe even engineering," he said in a 2017 interview on Bloomberg TV.

Some critics of Cuban wrote his predictions off. But in an era when employers are embracing efficiency offered by generative AI tools like ChatGPT, his remarks proved prescient. In just a couple of years, AI tools have gotten exponentially better at technical skills like computer programming and data analysis, sparking spirited debates — from campuses to economic think tanks — about the relevance of certain STEM degrees.

The only fault in Cuban’s theory was the time frame. It didn’t take until 2027. AI is already giving a leg up to humanities majors.

“I said this years ago and I’ll say it again,” Cuban posted on X in February 2024. “In an AI world, being trained in those liberal arts can be very valuable.”

A liberal arts degree is no guaranteed bulwark against the effects of AI and automation, however. While education that instills critical thinking and adaptability into graduates can certainly help them navigate a job market upended by AI, all recent graduates are facing diminishing employment prospects, according to a new report from the labor research firm Oxford Economics.

“There are signs that entry-level positions are being displaced by artificial intelligence,” the firm wrote, contributing to "higher unemployment among recent college graduates."

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