Over the past 24 months, Kirsten Staple has diligently submitted over 500 job applications. Initially, she focused on positions aligned with her 2022 Bachelor's degree in Psychology from the University of Texas at San Antonio. Despite her efforts, she has yet to secure employment. Staple's struggle underscores the complex predicament faced by many young Americans attempting to launch their professional journeys, even amidst a robust U.S. economy. While unemployment rates remain historically low, and businesses continue to recruit new talent, the number of job vacancies has surpassed pre-pandemic levels, as indicated by government statistics that are closely monitored by economists and policymakers to gauge the state of the labor market.

However, a closer examination of the data reveals a more challenging reality for younger job seekers. According to the Labor Department, the proportion of employed individuals aged 20-24 relative to the total working-age population experienced the steepest decline in September compared to the previous year, followed by a slightly less pronounced decrease among those aged 25-34. Furthermore, a survey by ZipRecruiter, indicates that the proportion of job seekers aged 18-24 who reported taking over a year to find employment increased threefold in the third quarter of this year compared to late 2022. Economists warn that early career setbacks can lead to significant losses in lifetime earnings and missed opportunities for skill development during the crucial early years of one's professional life.

"I feel like I'm falling behind," Staple expressed. "Any money I receive is either from my parents or as gifts for my birthday or Christmas. That income is very limited." In 2022, job openings reached an all-time high, and workers were so confident in their job prospects that they were quitting at a record pace—a consequence of the U.S. economy's swift recovery post-pandemic. Two years and a series of aggressive interest rate hikes by the Federal Reserve later, the U.S. economy has returned to a state more akin to pre-pandemic conditions. This is a positive development; the U.S. economy has thus far skirted a recession, a significant risk while the Fed aimed to reduce inflation. Indeed, the overall job market remains relatively healthy. However, a deeper analysis reveals factors that are hindering younger individuals from entering the workforce.

"The top-line figures from the jobs report still appear favorable, but the actual labor market activity, including hiring, job switching, and turnover, is significantly slower than those headline numbers suggest," noted Julia Pollak, Chief Economist at ZipRecruiter. "We are in the 'Great Stay,' where companies are hesitant to hire or fire, and job switching is also unusually slow." The rate at which workers are being hired dropped to its lowest point since October 2013 in August, excluding the initial economic turmoil at the start of the pandemic. Similarly, the rate at which workers are leaving their jobs has fallen to levels not seen since 2015, also excluding the sharp decline in early 2020 due to the pandemic. Employers have paused their hiring plans due to uncertainty surrounding the upcoming U.S. presidential election and are waiting for interest rates to decrease, as previously reported.

Everyday Americans are always subject to economic forces—whether it's navigating challenges such as high inflation and recessions, or a booming job market that benefits workers. The difficulty of securing that first job, partly due to broader economic factors, can have lasting consequences. "For young workers, the first few years after school are crucial for their career development. It's a time when they build their professional network, meet new people, and develop their skills," said Daniel Zhao, Lead Economist at Glassdoor. "Therefore, setbacks early in one's career can have enduring effects."

Zhao referenced Millennials who graduated during the Great Recession and suffered from lower earnings because they were "scarred by that experience," making them less likely to change jobs. "Job security became a priority for that generation, but a lack of job switching means employees might remain in a position that isn't the best fit for them, or they might not be paid at the market rate. However, due to their risk aversion, they choose to stay in that less-than-ideal situation," he explained.

Jonathon Courtney, who graduated from the University of Houston in August with a Master's degree in Applied Economics, has yet to find a permanent full-time position related to his field, despite applying to approximately 200 jobs over the past year. The 23-year-old Houston resident has only secured five interviews. Courtney sometimes questioned whether the effort he put into obtaining his graduate degree was worthwhile, but he eventually realized that the situation is beyond his control. "I don't think it was a waste to go to school and learn everything I've learned. I can see how to apply it in the real world," Courtney said. "But I do feel like I'm a victim of circumstances, starting in this job market."

Even for young Americans who have already begun their careers, there is still the risk of being laid off. Catherine Dugoni, 26, was laid off from her public relations job a year ago and has not found employment since, despite applying to hundreds of jobs and conducting around 60 interviews. She moved back in with her parents in Sacramento, California, from San Francisco because she could no longer afford the rent. "It's definitely taken a toll on my mental health," Dugoni said. "It's been disheartening at times, especially when it feels like you're just sending out applications into the void, and even networking doesn't always guarantee an interview."