A recent study from the Federal Reserve Bank of Dallas indicates that since ChatGPT's launch in 2022, job postings for AI-exposed roles in Texas have consistently declined, leaving newly minted college graduates especially vulnerable, with their unemployment rates reaching "unusually high" levels during this period.
By the first quarter of 2025, hiring for high AI-exposure positions had fallen roughly 8% compared to low-exposure roles. Researchers Samuel Dodini and Tucker Smith noted in their report that these trends highlight how recent graduates—whose unemployment has spiked during the rapid adoption of generative AI—are among the first to feel its impact on employment and earnings.
The Lone Star State's Data Center Boom Versus its White-Collar Slump
Texas currently leads the nation in data center construction capacity. Yet, this massive infrastructure investment hasn't translated into growth for professional office jobs; in fact, it appears to be happening alongside their decline. The Dallas Fed analysis points out that the most AI-exposed occupations in Texas are concentrated in software development, web design, and computer-intensive fields, with managers, clerical staff, editors, and other white-collar professionals also highly exposed. These are precisely the areas where college graduates have traditionally found the most opportunities.
The construction of data centers is generating demand for electricians, construction workers, and other blue-collar roles, rather than expanding positions for software engineers or data analysts. Meanwhile, AI tools themselves are beginning to automate parts of those latter jobs.
Public Pushback and Political Shifts
The data center boom is also fueling growing public opposition within Texas. A July 2025 survey from the University of Pennsylvania's Annenberg Public Policy Center revealed that 61% of American adults oppose having a data center built in their local area, a 12-percentage-point jump from a similar poll conducted in February and March of the same year.
Facing this voter backlash ahead of the November midterm elections, Texas's Republican Governor Greg Abbott has pivoted from being a champion of the data center industry to a vocal critic. In contrast, former President Donald Trump holds a starkly different view. In a Truth Social post on Monday, he argued that communities opposing data centers are essentially choosing stagnation and poverty over progress and wealth, stating that those who want success, lower taxes, and abundant jobs should let "data rule."
A Global Concern for Youth Employment
Texas's situation isn't isolated; it reflects a broader global trend. A report from the International Labour Organization (ILO) released in August highlights rising youth unemployment worldwide, particularly in high-income economies. The youth unemployment rate in North America has climbed from 8.3% in 2023 to 9.8% in 2025, while Northern, Southern, and Western Europe continue to grapple with a high 15% rate.
Sukti Dasgupta, director of the ILO's Employment, Skills and Sustainable Enterprise Department, cautioned that while AI's direct impact on jobs remains uncertain, complacency is dangerous. "Technological progress, including AI, must serve young people, not be their adversary," she said. The ILO report also notes that entry-level positions traditionally filled by young workers—such as clerical and administrative roles, certain manufacturing jobs, and some technical occupations—are shrinking.