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June 27, 2025 
5 min read
This month’s iCIMS Workforce Report takes a closer look at the Class of 2025 and the entry-level hiring market they’re stepping into. The results are a mixed bag.
New grads are eager to work and applying in droves, but many employers aren’t quite so eager. Amid economic uncertainty and shifting hiring priorities, entry-level candidates are facing one of the most competitive markets in a decade.
This month’s report explores:
Candidates are demonstrating that they’re ready to work, but many organizations are proceeding with caution. Applications rose 21% compared to last May, but hiring declined by 8%. Employers are contending with inflation, cost pressures, and tariff uncertainty. For many, this has led to hesitation about increasing headcount.
The unemployment rate for new graduates hit 6.6%, the highest it’s been in a decade (excluding the pandemic). That’s significantly higher than the national average of 4.2%. Entry-level applications jumped 22% year over year, driven by urgency, uncertainty, and a fierce job market.
Top concerns among Gen Z grads? Lack of experience or skills, economic instability, and intense competition. Despite the odds, they’re optimistic and determined to prove themselves.
There’s no one-size-fits-all story for entry-level hiring in 2025. According to iCIMS data, 33% of recruiters say they plan to slow or pause entry-level hiring, while the same percentage plan to grow those pipelines or prioritize internal mobility. The takeaway? Hiring decisions are increasingly tied to business strategy, not blanket recruiting goals.
Applicants per opening (APO) for entry-level roles hit 36 in May, up 22% from last year — a higher rate than the overall labor market. New grads aren’t just competing with each other, they’re vying for attention in an environment that rewards clear skills, strong communication, and adaptability.
Some sectors are seeing a shift in entry-level interest. Applications for manufacturing jobs surged 37% year over year, signaling Gen Z’s growing interest in “toolbelt jobs” that offer salary, stability, and skill-building. Meanwhile, healthcare saw only 12% growth in entry-level interest — creating a potential advantage for grads eyeing roles in a high-need, lower-competition sector.
There’s a disconnect between what recruiters say they look for in candidates and what they prioritize. While 95% claim to use skills-based practices, only 28% rank skills as the most important factor when evaluating entry-level candidates — behind experience (37%) and education (34%).
Gen Z sees the contradiction. Just 30% believe employers truly value their skills, though 44% say they’d welcome skills tests or job simulations to prove their abilities. For many grads, the resume isn’t the problem, it’s the lack of clear, credible ways to demonstrate what they can do.
Recruiters are bullish on AI’s role in the entry-level workforce. Nearly all (96%) say it’s likely new hires will manage or work alongside AI agents in the next two years. But tech native Gen Z is still unsure: 44% say they don’t expect AI tools to play a meaningful role in their jobs, or aren’t sure what that looks like.
As agentic AI gains traction, bridging this awareness gap — and preparing early-career talent to work effectively with these tools — will be key to future success.
The labor market remains full of contradictions: demand without decisive action, skills-based hiring in theory but not in practice, and a generation of eager candidates still waiting to be seen. For recruiters and TA leaders, this is the moment to close the gap: Between intention and execution, between tech and human touch, and between entry-level opportunity and real access.
Download the full June 2025 Workforce Report.
Trent Cotton is the Head of Talent Insights and Analyst Relations at iCIMS, where he empowers recruiting organizations with data-driven strategies to hire smarter and faster. With over 20 years of experience as an HR and Talent executive, Trent is known for translating complex workforce trends into clear, actionable insights that drive business results.
He is the author of the books High Performance Recruiting and Sprint Recruiting, which provide practical frameworks for transforming recruiting into a high-impact function. Passionate about bridging data with human decision-making, Trent continues to challenge traditional recruiting models and champion innovative approaches that meet the demands of today’s talent economy.
