Most people — and especially parents of 20-something college graduates — know that the job market is particularly tough right now for recent college grads. But so tough that about half of them are either unemployed or underemployed?
That is what analysts for the New York Federal Reserve Bank of New York calculated, in a January, 2014, report, “Are Recent College Graduates Finding Good Jobs?” Defining “underemployed as working in low-paid jobs that don’t require college degrees, the analysts, Jaison R. Abel, Richard Deitz, and Yaqin Su, found that roughly 6 percent of recent college graduates, aged 22 to 27, were unemployed at the beginning of 2013 and 44 percent were underemployed. The unemployment figure has likely dropped since then, along with the overall drop in unemployment. But it’s quite possible that underemployment — the percentage of college grads who are in jobs that don’t require college degrees — hasn’t changed much.
Curiously enough, this New York Fed study was largely a rebuttal to the popular notion that the job market is much worse for college grads today. The authors looked at two decades of data and found that the combination of unemployment and underemployment is roughly the same today as it was for college graduates in the early 1990s who also had to seek jobs during a recession. By age 30, the majority of the 1990s cohort eventually found better work, and the same could happen for the current crop of college graduates.
But the authors also pointed to some ominous signs. They drilled down into the data of the underemployed and noted that it’s more likely for recent graduates to be in a low-wage or a part-time job than in the past. In other words, there’s a smaller share of college graduates in well-paying non-college jobs, such as electrician, dental hygienist or mechanic. And there’s a rising share of college graduates in the lowest paid of the non-college jobs, such as bartender, food server and cashier. That could make it harder for these young adults to transition to higher skilled jobs in the next few years. Time will tell. <Read more.>
Via Jill Barshay, The Hechinger Report on Diverse Issues in Higher Education.