AI surge drives record unemployment among Texas college graduates

Researchers have revealed that the rapid spread of artificial intelligence is leading to unusually high unemployment rates among university graduates in Texas, the US state with the largest data center capacity under construction.

According to the Financial Times, citing researchers at the Federal Reserve Bank of Dallas, job postings in Texas that rely on AI have declined since the launch of ChatGPT in 2022, disproportionately affecting university graduates and those switching careers.

A Dallas Fed analytical report stated that in the first quarter of 2025 alone, job postings for AI-dependent roles dropped by nearly 8 percent compared to positions less reliant on the technology.

Researchers Samuel Dodini and Tucker Smith noted in their analysis that these dynamics suggest the impact of generative AI on employment and wages is appearing first among recent college graduates, whose unemployment rates have reached unprecedented levels during the rapid adoption of generative AI.

The research highlights how AI is reshaping the Texas job market, prompting Governor Greg Abbott to shift from a strong supporter of the industry to an outspoken critic, amid growing voter backlash against the data centers needed to power the technology ahead of the upcoming midterm elections in November.

Meanwhile, a recent report from the Annenberg Public Policy Center at the University of Pennsylvania noted that opposition to AI data centers has surged across the US, with 61 percent of adults opposing the construction of such facilities in their areas in July—a 12-point increase from a survey conducted in February and March.

The Financial Times also reported that former US President Donald Trump, a strong supporter of the AI sector, insists that AI will drive economic growth and job creation, dismissing rising public opposition to data centers.

On Monday, Trump wrote on his Truth Social platform: "The only reason communities across America would reject data centers is if they want to be left behind and poor. But if they want success and wealth, with much lower taxes and abundant jobs, let AI lead the way."

These developments in Texas come amid growing concerns that AI is eliminating job opportunities for young people worldwide.

In August, the International Labour Organization revealed that global youth unemployment is rising, especially in high-income economies.

The organization noted that youth unemployment in North America increased from 8.3 percent in 2023 to 9.8 percent in 2025. It added that the rate in Northern, Southern, and Western Europe remains high at 15 percent in 2025.

The ILO report concluded that jobs traditionally available to young people—such as clerical, administrative, manufacturing, and some technical roles—are shrinking.

Researchers from the Dallas Fed pointed out that the professions most affected by AI in Texas include software development, web design, and jobs requiring intensive computer use. They added that managers, clerical staff, editors, and other office-based professionals are also highly exposed to AI's impact.