AI Hype Versus Reality and a ‘Generational Recession’: New Goodwill Report Reveals Growing Workforce Gaps

New research commissioned by Goodwill Industries International finds more than half of Americans have a personal connection to job cuts; AI hype fails to translate into the workplace and America’s youngest workers struggle to keep up.

Amid widespread layoffs and economic disruption, a new report from Goodwill Industries International (GII) reveals a number of critical gaps in the reality of today’s workforce. The Workforce in Flux: Americans and the Changing World of Work report, released today, includes findings that allude to a deepening “generational recession” affecting the nation’s youngest workers as well as a widening gap between AI expectations and reality.

The report finds that Gen Z is experiencing significantly lower career confidence than any other generation, leading to delays in achieving major financial milestones. According to the findings, less than one-third (31 percent) of Gen Z respondents plan to stay on their current career path and 42 percent of Gen Z respondents have delayed landmark goals, such as paying off debt, pursuing education, purchasing a home and making investments.

The report also found that Americans are not yet using AI as a primary career tool, despite the technology’s hype and dominance in the news cycle. Only 22 percent of Americans, across all generations, use AI for career training and upskilling, and 35 percent do not use it in their professional lives at all. Despite being digital natives, Gen Z workers are not leading the AI charge, with 38 percent resisting the technology altogether in their professional lives.

“America’s workforce has historically been one the great strengths of our economy, but this research shows that the future of our workforce – younger workers – are facing significant challenges,” said Steve Preston, president and chief executive officer of GII. “Too many young workers are experiencing a confidence gap, especially as work changes faster than they can adapt. Goodwill organizations across the country are helping to close that gap through hands-on skills training, support services and career guidance, showing individuals how to navigate change and use AI as a tool for their own success.”

Other key findings from the report include:

• Layoff Reverberations: In 2025, most Americans were either directly affected by job cuts or know someone who has been.
• Stagnation Risks: Among those who reported being unemployed and looking for work, nearly one quarter (24 percent) have been searching for more than a year, indicating a significant risk of long-term career stagnation.
• Career Shifts: Roughly one in five Americans are planning a ‘dramatic career shift’ in response to the current economic climate. More than half of Gen Z workers are considering changing jobs in some capacity.
• AI Hesitancy: More than half (54 percent) of workers do not trust AI to support or advance their careers, and many cite a lack of employer-led training.
• Confidence Gaps: Americans are confident in themselves, but not necessarily in the market. More than half (56 percent) said the current economy makes it difficult for them to use their education and skillset, but when asked to reflect on their current positions/careers and where they were in comparison to 12 months ago, 86 percent of Americans reported currently feeling confident. Only 28 percent of Gen Z reported feeling confident in their knowledge of “what to do next” if they were to lose their job today, compared to 59 percent of Baby Boomers.
• Social Media as Career Resource: When it comes to career advancement, upskilling, and training, Americans are bypassing traditional professional organizations, with the top resources utilized being free online resources (34 percent) and social media (33 percent). For Gen Z, social media (38 percent) is the number one source for career training and upskilling.

Over the last year, news headlines and social media feeds have been filled with stories of a changing workplace, with automation, AI, economic fluctuations among the major drivers. Mass layoffs, rapid shifts, and consequential disruptions left many workers feeling uncertain about their professional futures. Yet, despite a wealth of jobs data and research, very little is known about the experiences of the people behind the numbers. GII undertook this research to fill that gap.

Goodwill has always served people at moments of transition and during challenging times. As the nation’s largest nonprofit provider of workforce development, the Goodwill network offers a comprehensive suite of services, including digital upskilling, hands-on career navigation and holistic support that includes childcare and transportation assistance.

“Goodwill is committed to ensuring job seekers don’t have to navigate the market alone,” added Preston. “By providing clear, credentialed pathways and meeting people where they are, both in person and online, we are helping them find their next job and rebuild their confidence.”