Who should new grads boo more? AI or remote work?

Summary

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The Indicator from Planet Money

Episode: Who should new grads boo more? AI or remote work?

Date: June 5, 2026
Hosts: Adrienne Ma, Darian Woods, Waylon Wong

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Episode Overview

This episode dives into the latest jobs report, focusing on the challenges facing new graduates in the current labor market. The hosts explore whether artificial intelligence (AI) or the rise of remote work is a bigger obstacle for young job seekers. They also discuss the broader labor market, wage growth, inflation, and how trends among Black workers can serve as a leading indicator for the economy as a whole.

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Key Discussion Points & Insights

1. The May Jobs Report: A Snapshot

• Strong Job Growth Continues
  • [02:33] Adrienne Ma summarizes: "May was a strong month for jobs. 172,000 jobs added...This latest report includes some revised estimates for the months of March and April...employers added 93,000 more jobs than was previously reported."
  • Three consecutive months of solid hiring signal potential for economic momentum.
• Sector Highlights & Wages
  • [03:12] The biggest job gains are in "leisure and hospitality, local government, and healthcare."
  • Average hourly wage: $37.53, up 3.4% from a year ago, but still lagging behind inflation at 3.8%.
• Implications for Federal Reserve Policy
  • [03:38] Darian Woods: "It's going to be pretty unlikely that the Federal Reserve is going to decide to cut interest rates in the near future."
  • [03:48] Adrienne Ma points out reluctance for rate cuts due to persistent inflation: "In this environment, the case for an interest rate cut makes even less sense. And some economists might even see cause for a rate hike."

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2. Young Workers in the Job Market

• Youth Unemployment Update
  • [04:42] Darian Woods: "The jobs report showed that the unemployment rate of Americans aged 20 to 24 decreased a little, to 7.2% in May. Now, historically, that's kind of average, but it doesn’t include all of the people who...are just going to go back to school."
• Is AI to Blame? The Viral Villain
  • [05:09] Adrienne Ma: "Judging by the sort of viral clips of commencement speeches, you would think that this is all because of AI being the big villain here."
  • Former Google CEO Eric Schmidt is booed at a commencement for referencing AI’s ascent, underscoring new grads' anxieties.
    • Quote: [05:22] Eric Schmidt: "Time magazine selected its Person of the year for 2025, and it was...the architects of Artificial Intelligence."
• Research Shifts Blame to Remote Work
  • [06:11] Darian Woods describes two new studies suggesting that remote work—not AI—is more responsible for making it harder for new grads to land jobs.
    • First study: Remote work reduces the hiring of junior workers across sectors.
    • Second study: "Nearly two thirds of the recent rise in unemployment among young college graduates is because of remote work."
  • Quote: [07:11] Darian Woods: "Gen Z need not apply. The idea is that onboarding is much harder in a remote work world. And so hiring managers are leaning towards getting people that already know the workplace basics."
• Potential Solutions and Tradeoffs
  • [07:32] Waylon Wong highlights the long-term value of training younger workers: "If you take the time now to train Gen Zers about how to do this kind of work, you know, there could be a payoff later that maybe employers aren't thinking of."
  • [07:50] Darian jokes: "Maybe AI is the savior. Okay, let's revisit this in five years."

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3. Black Workers: A Key Economic Signal

• Disparities and Trends in Black Unemployment
  • [08:01] Waylon Wong: "The jobless rate for Black workers was 6.6%, compared with 4.3% for all workers. That said, the 6.6% number is an improvement. It's down from April and it's the lowest rate in a year."
• Impact of Public Sector Layoffs
  • [08:32] Citing the Economic Policy Institute: "Black women suffered the greatest job losses in 2025. Its analysis also shows that the overall net loss was driven entirely by cuts in public sector jobs."
• Black Unemployment as a Leading Indicator
  • [09:05] Waylon Wong: "Research from Kevin Rins at the Cleveland Fed...determined that when the unemployment rate for black workers goes up, it tends to be followed by higher overall unemployment."
  • [09:29] Adds: "If the black unemployment rate goes up 1 percentage point, you can expect the overall unemployment rate to go up about 0.2 percentage points in four to seven months."
  • [09:42] Darian Woods: "We hear about recession indicators all the time. And this one, going back to basics, the unemployment rate for black workers seems like it has some empirical backing to it."

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Notable Quotes & Memorable Moments

• On the headline numbers:
  [02:33] Adrienne Ma: "Employers added 93,000 more jobs than was previously reported. And that's on top of what were already strong hiring numbers."

• On AI’s scapegoating by new grads:
  [05:09] Adrienne Ma: "Judging by the sort of viral clips of commencement speeches, you would think that this is all because of AI being the big villain here."

• On remote work’s unexpected downside:
  [07:11] Darian Woods: "Gen Z need not apply. The idea is that onboarding is much harder in a remote work world."

• On economic forecasting:
  [09:29] Waylon Wong: "If the black unemployment rate goes up 1 percentage point, you can expect the overall unemployment rate to go up about 0.2 percentage points in four to seven months."

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Timestamps for Important Segments

• [00:30] – Overview of the May jobs report
• [03:38] – Impact on Federal Reserve policy and interest rates
• [04:42] – Youth unemployment update and challenges for new grads
• [05:22] – Eric Schmidt’s AI comments at a commencement
• [06:11] – New research: remote work's impact on junior hires
• [08:01] – Black unemployment rate trends and significance
• [09:05] – Black unemployment as a leading economic indicator

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Summary

With unemployment steady and job growth strong, the US labor market appears resilient—but beneath the surface, young workers are facing persistent challenges. Contrary to public perception stirred by viral commencement moments, the real culprit may be the widespread adoption of remote work, which makes training and onboarding newer employees difficult. At the same time, movement in the black unemployment rate continues to offer a vital early warning for broader economic shifts. This episode offers a nuanced, data-rich look at the forces shaping the job market for new grads—and for all workers—in a high-inflation, increasingly AI- and remote-driven economy.

Transcript

[Darian Woods]

Npr.

[Adrienne Ma]

This is the indicator from Planet Money, also known as the 2026Ambie Award winning Best Business Podcast. I'm Adrienne Ma.

[Darian Woods]

I'm Darian Woods.

[Waylon Wong]

And I'm Waylon Wong. And it is Jobs Friday. It's the day each month where we look at the latest government jobs report and we check in with how American workers are doing.

[Adrienne Ma]

That is right. And according to the latest report from the Bureau of Labor Statistics, the unemployment rate in May remained at 4.3%. So same as the past couple of months. And employers added 172,000 jobs.

[Darian Woods]

That's a pretty good number overall. And you know this is the third month in a row that employers have added a decent number of jobs.

[Waylon Wong]

That's true, but we always like to dig beneath the headline numbers and add some detail to the picture.

[Adrienne Ma]

Computer enhance so after the break we'll explain what is driving job growth right

[Darian Woods]

now, whether AI is really to blame for young people struggling to land their

[Waylon Wong]

first job, and how the unemployment rate for black workers could be a signal of what's to come.

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[Darian Woods]

We're looking at this month's jobs report. Why don't you kick us off?

[Adrienne Ma]

Adrian Ma so like we said, May was a strong month for jobs. 172,000 jobs added. And in fact this latest report includes some revised estimates for the months of March and April. They were revised upwards as the BLS got more data and between those two months that means employers added 93,000 more jobs than was previously reported. And that's on top of what were already strong hiring numbers.

[Waylon Wong]

All right, so we've got three months in a row of strong hiring. So maybe perhaps the labor market is starting to shake off this low hire, low fire sluggishness we've been seeing for a lot of the past year.

[Adrienne Ma]

That could be. And a couple more interesting notes from this report. It says most of the jobs added last month were in the leisure and hospitality sector, local government, and healthcare. And the average hourly wage was $37.53 an hour. That is 3.4% higher than a year ago, but not quite enough to keep up with inflation, which recently clocked in at 3.8%.

[Darian Woods]

So this jobs report has made me think that it's going to be pretty unlikely that the Federal Reserve is going to decide to cut interest rates in the near future.

[Adrienne Ma]

I mean, this is a good point, right? Because as we know, President Trump has been jawboning the Fed to lower interest rates to try and juice the economy. But the job market is gaining steam. And inflation, rising prices for gas, groceries, and other things, that's really the growing concern right now. And the Fed cutting interest rates would just add to inflation. So in this environment, the case for an interest rate cut makes even less sense. And some economists might even see cause for a rate hike. Mm.

[Waylon Wong]

Interesting environment for a new Fed chair to be stepping in. Thank you for that, Adrian. And now we're going to dive into some specific groups.

[Darian Woods]

Jerry and Woods, I was particularly interested in the unemployment rate for younger workers.

[Waylon Wong]

Right. A lot of young people have just graduated from trade school or college. So this is going to be what they're obsessed with right now and what

[Adrienne Ma]

their parents are probably going to be thinking about.

[Darian Woods]

Yeah. So those parents will be relieved because the jobs report showed that the unemployment rate of Americans aged 20 to 24 decreased a little, to 7.2% in May. Now, historically, that's kind of average, but it doesn't include all of the people who think that the jobs market is so bad that they're just going to go back to school. Younger people have been feeling frustrated about the jobs market for a few years now.

[Adrienne Ma]

I mean, judging by the sort of viral clips of commencement speeches, you would think that this is all because of AI being the big villain here.

[Darian Woods]

Yeah. Here's former Google CEO Eric Schmidt speaking at the University of Arizona.

[Michael Hosmar]

Time magazine selected its Person of the year for 2025, and it was this time, it was the architects of Artificial Intelligence. Interesting.

[Waylon Wong]

So today oh, man, they're just. They're really not having it.

[Darian Woods]

They are not. And there has been a smattering of research over the last year supporting those boos. It says AI is to blame for low hiring rates for junior workers.

[Waylon Wong]

Eric Schmidt should have pivoted and started just reading out those studies. Yeah, he could have gotten the crowd back on his side.

[Darian Woods]

Well, what he needed were two new studies which are casting doubt on the AI theory. They have accused another big force for the dearth of junior hires, remote work.

[Adrienne Ma]

Oh, okay, that's interesting. So this predates the whole AI boom.

[Darian Woods]

It does, but it's actually very similarly timed as people kind of figured out that remote work did have some friction in the gears of running a business. So the first paper from two economists in the UK looked at hundreds of millions of hires and jobs postings all across the US and other countries from 2017 to 2035. Now, they couldn't find much evidence that AI was killing that many junior jobs, even in tech, but what they did find was that jobs that were more likely to have remote workers were less likely to hire people with limited experience. And the second paper was from three economists in the US in findings released this week, they conclude that nearly two thirds of the recent rise in unemployment among young college graduates is because of remote work.

[Adrienne Ma]

So employers are basically telling Gen Z like, no, thanks, don't worry about applying.

[Darian Woods]

Gen Z need not apply. The idea is that onboarding is much harder in a remote work world. And so hiring managers are leaning towards getting people that already know the workplace basics. They know the on the job skills and how to communicate with others, being proactive, all that stuff that face to face makes easier.

[Waylon Wong]

I do see that rationale. I also think that if you take the time now to train Gen Zers about how to do this kind of work, you know, there could be a payoff later that maybe employers aren't thinking of.

[Darian Woods]

Absolutely. And training seems to be easier face to face.

[Waylon Wong]

Could you use AI to train?

[Darian Woods]

Maybe AI is the savior. Okay, let's revisit this in five years.

[Adrienne Ma]

Thank you, Darian, for that bit of insight into younger workers. Uh, Waylon, why don't you go next?

[Waylon Wong]

Okay. I am here to talk about another area of concern that could potentially signal trouble for the broader labor market, and that is black workers. This is a group where their unemployment rate has historically been higher than the main number. And this was definitely the case in May. The jobless rate for Black workers was 6.6%, compared with 4.3% for all workers that said the 6.6% number is an improvement. It's down from April and it's the lowest rate in a year, so it

[Adrienne Ma]

hopefully keeps moving in that direction.

[Waylon Wong]

Yeah, and black women in particular really felt the effects of the mass layoffs and buyouts we saw with federal workforce last year. I read an analysis from the Economic Policy Institute. That's a think tank that advocates for low and middle income working families. And the EPI says that black women suffered the greatest job losses in 2025. Its analysis also shows that the overall net loss was driven entirely by cuts in public sector jobs.

[Darian Woods]

I wonder whether some of these federal workers finding new jobs might be why the black unemployment rate went down.

[Waylon Wong]

Yeah, it's encouraging data, but, you know, if the black unemployment rate were to go back up, that could be a bad signal. There was some other research that caught my eye recently. It comes from Kevin Rins, an economist at the Cleveland Fed, and he determined that when the unemployment rate for black workers goes up, it tends to be followed by higher overall unemployment.

[Adrienne Ma]

Right. So that's what they call a leading indicator.

[Waylon Wong]

Yeah. According to his analysis, if the black unemployment rate goes up 1 percentage point, you can expect the overall unemployment rate to go up about 0.2 percentage points in four to seven months.

[Darian Woods]

That's super interesting. We hear about recession indicators all the time. And this one, going back to basics, the unemployment rate for black workers seems like it has some empirical backing to it.

[Waylon Wong]

Absolutely. Yeah, it's back to basics.

[Darian Woods]

This episode was produced by Corey Bridges with engineering by Robert Rodriguez. It was fact checked by Cierra Juarez and Vito Emanuel. Kate Concannon edits the show and the Indicator is a production of npr.

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