Artificial intelligence is transforming the hiring process, leaving many college students and recent graduates searching for ways to stand out in an increasingly competitive job market. As employers adopt AI-powered screening tools, young job seekers say landing an interview can feel more challenging than ever.

Michela DiLorenzo, a student at Seton Hall and student editor at The Setonian who has covered the careers sentiment on campus, recently wrote that post-graduation plans for many of her peers have changed as they enter an uncertain job market. Rather than immediately pursuing graduate degrees, some are taking summer jobs or other work to save money as they consider their next steps.

"AI is really changing the motivation that students have going into the job market. It's changing the hiring process, how people are formatting their resumes and just overall, how students are approaching life post-grad," Michela said in an interview with CNBC's Jon Fortt on Friday.

According to the Federal Reserve Bank of New York, college graduates in the 22- to 27-year-old age bracket had an unemployment rate of 5.7% as of June 2026, significantly above the national average and a full percentage point higher than it was two years ago for their cohort. The unemployment rate for all young workers was 7.2%. Meanwhile, the underemployment rate — college graduates working in jobs that do not require a bachelor's degree — has reached 42%, compared to 33.7% for all college graduates.

For students, the challenge is not only finding an opportunity but getting noticed. Employers are using AI to screen and review applications, while students are trying to figure out how to incorporate it into their job hunt.

Sixty-six percent of recruiters said at the beginning of 2026 that they were planning to increase their use of AI for pre-screening interviews, according to LinkedIn research, while 81% of job seekers said they had used or planned to use AI in their job search. That puts more of the earliest stages of the job search into automated systems.

There are also concerns that AI is eliminating jobs that are at the entry level of organizations, but the research remains preliminary in nature. The Federal Reserve Bank of New York has found an overall slowdown in hiring in recent years, but not specifically concentrated in entry-level jobs with higher AI exposure.

Based on its study of job postings, the NY Fed wrote, "while AI may be contributing to recent labor market developments, it is not the main driver of the slowdown in hiring."

Its survey work with employers found that they "mostly intend to incorporate AI mainly via retraining, with limited effects on hiring."

Students are trying to understand how their materials may be evaluated before reaching a hiring manager. Students are tailoring resumes to specific job descriptions, emphasizing relevant skills and using language that aligns with the position.

Handshake, an early-career platform for students and job seekers which has worked with OpenAI on tools to increase student tech skills, says graduating seniors in 2026 mentioned AI skills on their resumes at twice the rate of the class of 2022. Its analysis found that 74% of those mentions were tied to real-world projects rather than coursework, an indication students are trying to demonstrate their applied experience. 

"Early talent is already starting to answer this shift by sharing real projects directly on their Handshake profiles, turning AI from a claimed skill into demonstrated capability," Handshake wrote in a blog post. "The data tells us that early talent isn't being displaced by AI—they're being amplified by it. ... in an AI-driven workforce, resumes alone aren't enough."

The National Association of Colleges + Employers says its recent research shows more employers expecting AI skills in new hires, with the requirement cited in 16.5% of job descriptions in the spring, versus 10.5% last fall. Overall, 28% of employers say they are seeking early career talent who can use AI in their work, according to NACE.

NACE is concerned about what it calls a "striking disconnect" between some members of Gen Z and the labor market. "Employers are increasingly asking graduates to be ready for AI, while a significant portion of students are asking whether AI deserves a place in their work at all," Shawn VanDerziel, NACE president and CEO, stated in the research release.

In NACE's 2026 Student Survey, close to one-third of graduating seniors said AI skills would be "of little or no importance to their future career." Over half said they were not building AI skills for the future and were not using AI in their job search.

"Right now, it is too early to tell what the long-term impact of AI will be on early career talent, but it is obvious that students have mixed expectations and views on the ways AI will impact their careers," VanDerziel stated.

DiLorenzo's reporting showed how uncertainty is affecting students at Seton Hall. One student said she had received only two interviews after submitting 50 applications. Another said he had applied for as many as 150 jobs, describing the process as impersonal and discouraging.

While AI can help employers manage a high number of applications, students say they still want meaningful feedback and a clearer path to being seen by a person.

At a broader labor market level, being seen as a person is becoming a significant problem for the youngest workers. The companies that are adopting AI faster are also hiring faster than peers, according to Evan Sohn, founder and CEO of labor market research firm Revelio Labs. But that may not be of much help to recent college grads, he told CNBC's Kelly Evans in a recent interview, because these firms are also prioritizing senior-level roles over junior-level positions. "AI is really making it difficult for the entry-level people to get in there. ... The 22- to 25-year-olds are really getting lost in the shuffle," he said.

Nevertheless, Sohn's advice for all job seekers is to "be AI-forward."

"Be ahead of everybody else when it comes to AI," he said.