New York Fed flags hiring gap

The Federal Reserve Bank of New York said June 1 that remote work, rather than generative AI, appears to be the main driver behind weaker employment outcomes for younger college graduates in recent years. In a Liberty Street Economics post, researchers Natalia Emanuel, Emma Harrington and Amanda Pallais said the spread of remote work since the pandemic has made firms less willing to hire workers who need training and close supervision. (libertystreeteconomics.newyorkfed.org) Their analysis linked the rise in remote-capable jobs to a deterioration in labor-market outcomes for younger degree holders, even as older college graduates fared better. ### What did the New York Fed actually find? The June 1 post said youth unemployment has risen markedly since the pandemic at the same time remote work has become more common. (libertystreeteconomics.newyorkfed.org) The authors estimated that remote work can explain 64% of the recent increase in unemployment among young college graduates. They also wrote that the timing of the increase suggests remote work, not generative AI, explains most of the rise. The researchers said remote work “has weakened incentives to hire young workers by impeding on-the-job training,” according to the Fed post and AP’s summary of the findings. Their argument was that managers are more willing to bring on inexperienced workers when training and mentoring can happen in person. (libertystreeteconomics.newyorkfed.org) ### Why would remote work hit younger graduates more than older ones? AP reported that the study examined federal employment data and internal information from an unnamed Fortune 500 technology company. In that company’s office-closure period, AP said, the employer hired fewer inexperienced workers and more experienced ones while staff worked remotely. (libertystreeteconomics.newyorkfed.org) NPR reported that unemployment among college graduates under 29 rose about 20% after the pandemic, while unemployment among older college graduates fell slightly. The gap was concentrated in occupations that can be done remotely, according to the Fed research cited by NPR. ### How did the researchers separate remote work from AI? (libertystreeteconomics.newyorkfed.org) The June 1 Liberty Street Economics post said the timing matters. The authors said the jump in unemployment for younger graduates lines up with the post-pandemic expansion of remote work, while the rise predates the period when generative AI would be expected to have had broad labor-market effects. A separate May 2026 Liberty Street Economics post looked specifically at whether job postings showed early labor-market effects from AI. (apnews.com) That earlier research examined AI exposure in postings, while the June 1 paper focused on remote-work intensity and unemployment among young graduates. Taken together, the Fed’s recent work treated remote work and AI as distinct channels rather than a single explanation. (npr.org) ### What does this change for teams that rely on junior hires? The Fortune 500 company evidence cited by AP points to a narrower apprenticeship pipeline when work shifts away from the office. That matters for operations-heavy teams because fewer entry-level hires means less informal training and fewer future maintainers for internal systems, especially where workflows depend on undocumented processes. (libertystreeteconomics.newyorkfed.org) The June 1 Fed post did not address GTM or RevOps systems directly, but its findings on training and mentorship support the idea that distributed teams may need more formal documentation if fewer junior workers are learning by observation. That is an inference from the study’s training mechanism, not a direct claim by the authors. (libertystreeteconomics.newyorkfed.org) ### Where can readers find the underlying research? The New York Fed published the analysis on June 1 on its Liberty Street Economics site and also posted a related data file alongside the article. AP and NPR both summarized the findings on June 1, drawing attention to the same core result: recent graduates appear to be losing out most in remote-capable work. (libertystreeteconomics.newyorkfed.org) (apnews.com)