The entry-level squeeze: Small businesses pulling back from hiring new grads

Small businesses are cooling on entry-level hiring—and the Class of 2026 may feel the chill. 

A national survey reviewed by Fast Company finds that firms with fewer than 500 employees are 30% more likely than larger employers to say they won’t hire recent graduates this year, marking the steepest expected pullback in more than a decade. 

Roughly one in five small employers say they either won’t hire college grads at all or plan to hire fewer than in 2025, a trend that is even harsher for candidates with graduate or professional degrees.

The slowdown is playing out alongside broader caution in the small business sector: Only 56% of small firms were actively hiring or trying to hire as of October, according to the National Federation of Independent Business. 

The data suggests that early-career workers face a tougher entry-level market as employers grow more selective, prioritize experience and keep payrolls lean—raising questions about how new graduates will gain a foothold in the workforce. 

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