Because of AI, Many Gen Z Choose Trades Over College

Jakarta, CNBC Indonesia – A new trend in education is shifting the way people view higher education. It concerns the opinions of young people considering higher education. A recent Gallup survey found that almost a quarter of Americans say they do not trust higher education or do not go on to college. There are strong and real reasons: the main factor is the cost of tuition.

If you go deeper, many of those who lack confidence say universities do not teach skills that are relevant to the high costs. The average tuition charged for a four‑year degree at public universities in America has more than doubled in the last 30 years after adjusting for inflation.

Although AI creates new types of jobs, such as software engineers who help implement it in companies, AI also makes it harder for some graduates to obtain their first jobs. A study by Stanford, Harvard, and King’s College London found that firms adopting generative AI in the United States and the United Kingdom tend to hire fewer junior professionals.

In November, 6.8% of those aged 20 to 24 with a bachelor’s degree in America were unemployed, compared with 8.6% of those who only have a high school diploma.

Among university graduates who have got jobs, more than half are working in roles below the standard for a four-year degree a year after graduating, and 73% of those who started in below‑standard roles remain so a decade later.

At the same time, interest in manual trades requiring skills is rising.

On social media platforms such as Instagram and TikTok, young plumbers and electricians post videos of daily work that garner tens of thousands of views and admiration in the comments.

A survey published in June by the American Staffing Association found that one in three adults would advise youths leaving school to pursue vocational or trade school, slightly more than those who would encourage them to study at a university.

Some are following that advice, with enrolment in two-year vocational and trade programmes at American community colleges rising by almost 20% since 2020. The number of active apprentices in America has more than doubled since 2014, according to the American Labour Association.

Bright future

University graduates over the age of 25 still enjoy lower unemployment and almost double the average annual pay of high‑school graduates. But when you look more closely at individual degrees, the results vary. People with a bachelor’s degree in science, technology, engineering, or mathematics earned an average annual salary of $98,000 in 2024, according to a study from Georgetown University.

Arts and humanities graduates have an average earnings of $69,000. Conversely, the average annual salary for lift technicians in America is $106,580.

The pay range within different occupations is also wide. The average annual pay for electrical technicians in America is $62,000 per year, but the top 10% earn more than $100,000 each. The same applies to plumbers, boiler operators, aircraft mechanics, and electricians.

None of these jobs require a bachelor’s degree, although they demand specialist training. Blue-collar workers are also in high demand for industries such as advanced manufacturing and defence.

Nearly 60% of manufacturing and new chip-design roles to be created in America between 2023 and 2030 are projected to remain unfilled due to a shortage of skilled workers, according to a study by the Semiconductor Industry Association and Oxford Economics. Of those unfilled roles, 40% are technician roles that require only a two‑year degree.

Jensen Huang, CEO of Nvidia, a chip manufacturer, says that data-centre AI will require hundreds of thousands of electricians, plumbers, and carpenters. In the UK, industry reports estimate a shortage of 35,000 skilled welders needed to build offshore wind farms, nuclear power plants, and submarines, among other projects.

Many of those with such skills are already older: about half of the UK’s welding workforce is expected to retire by 2027.

One solution to the skills shortage is to encourage more young people to study vocational skills. But there remains a stigma attached to blue-collar work.

‘Many parents see it as dirty, dark, and a dead end. The lack of coordination between schools, industry, and government is also a problem,’ said Sujai Shivakumar of the Centre for Strategic and International Studies, a Washington-based think tank.

Community colleges often offer courses that boost enrolment but not the courses that industry needs. This leaves vocational graduates with poor job prospects despite a shortage of skills.

‘A better solution is to learn from countries such as Switzerland, where around two‑thirds of young people undertake vocational training after 11 years of mandatory schooling. The system works because it has permeability, enabling students to move back and forth between vocational and academic tracks,’ said Ursula Renold, a vocational education expert at ETH Zurich, a Swiss university.