New York Fed Study Finds Higher Unemployment Rate for Young College Graduates in Remote-Eligible Jobs

The unemployment rate among young college graduates in jobs that can be performed remotely rose by about 1 percentage point between 2017-2019 and 2022-2024, according to a study released Monday by the Federal Reserve Bank of New York. For workers aged 29 and over in the same occupations, the jobless rate declined slightly over the same period.

The result is a higher unemployment rate for college graduates 28 or younger in remotable fields compared with older workers.

The study compared occupations that can be done remotely, such as software development, with those performed in person, such as nursing. In non-remotable jobs, the study found little gap in unemployment rates between older and younger college graduates. A similar pattern of higher unemployment for young workers in remotable jobs also appeared among those without college degrees.

The Federal Reserve Bank of New York concluded that businesses are reluctant to hire new college graduates into remote work because it is harder to train and mentor them outside the office. The authors calculated that remote work is responsible for nearly two-thirds of the rise in the unemployment rate for young college graduates since the pandemic.

“Remote work has weakened incentives to hire young workers by impeding on-the-job training,” the study said.

The Federal Reserve Bank of New York found companies preferred to hire more experienced workers for jobs that can be done remotely as opposed to non-remote jobs.