College Grad Unemployment and Useless College Degrees.
Posted: May 11th, 2012 | Author: Joe | Filed under: Economy, Employment | Tags: college tuition, Economy, Education, jobs, UnEmployment | 1 Comment »The college grad unemployment or underemployment rate is currently at 53%, but is a poor economy to blame or useless college degrees?
Before we get into that question, let’s step back and take a look a closer look at the unemployment problem for recent grads.
College grad unemployment/underemployment is bad, real bad.
The news has been awash in horror stories about recent college graduates not finding work. Many more are able to find work, but not in their chosen field.
“More than half of America’s recent college graduates are either unemployed or working in a job that doesn’t require a bachelor’s degree”.
This according to the article, 53% of Recent College Grads Are Jobless or Underemployed—How? from The Atlantic.
The Atlantic (as most other sources I’ve seen) doesn’t break the number down, so it’s difficult to tell how many college grads are actually unemployed, vs. how many are considered underemployed.
This is an important question because I think it highlights a big problem in education in America today. It’s easy to point to grads who seem unwilling to take low level jobs that are available and say they’re lazy or have a sense of entitlement, and in some cases that’s certainly true, but there’s also a very real financial reason at play – namely, student loan debt.
College degrees are more expensive than ever, and students have piled on the debt. There was a time when this was a smart move because the higher level of education would help you find a good paying job, and the debt was affordable over time. But things are different now, and it’s a lot harder to pay off $30,000 in student loans when your working the line at a fast food restaurant.
This doesn’t just lead to higher college grad unemployment rates though. This also causes systemic problems in the economy since those highly educated grads are taking low skill jobs that could go to others. Those jobs would traditionally go to less educated workers.
Economy and the job market to blame for college grad unemployment, or is it useless degrees?
All of this sounds bad, hopelessly bad. But not all doors lead down College Grad Unemployment Row.
According to this article, Half of recent college grads underemployed or jobless, analysis says , from the AP:
“…students who graduated out of the sciences or other technical fields, such as accounting, were much less likely to be jobless or underemployed than humanities and arts graduates.”
It sounds like going to school for math and science based degrees does still pay off in the end, so this begs the big question:
Is the college grad unemployment problem because the job market stinks and the economy has fundamentally changed? or is it simply due to useless degrees?
It used to be said that going to college was simply paying your dues and doing your time for a fancy piece of paper. Cynics would say that the paper didn’t mean much, but it opened doors because so many jobs were only available to those with a college degree -any college degree.
Times have changed.
It appears that you not only need that fancy piece of paper, but you also need the skills to do the job.
Here’s another quote from that AP article:
“I don’t even know what I’m looking for,” says Michael Bledsoe, who described months of fruitless job searches as he served customers at a Seattle coffeehouse. The 23-year-old graduated in 2010 with a creative writing degree.
They don’t go into how much student loan debt Michael has, but I’d bet it’s a lot – more than he’ll be able to manage on his coffeehouse job. But what was he expecting?
What good is a creative writing degree?
Don’t get me wrong, I admire writers and creative writing is not something many people can do well. It takes a certain innate ability and creativity that can be cultivated but cannot be taught. Not everyone gets to be Stephen King.
I’d say that Michael, and others like him, would be extremely fortunate to get a job somewhere making $30,000 a year with his degree, but what do you want to bet he has that or more in student loan debt?
A simple truth that no one seems to want to discuss is that for some degrees, debt doesn’t make sense.
I ask you, what would full employment be for a graduate with a degree in creative writing and do enough such jobs exist for the number of graduates seeking employment?
As Mish points out on his blog post, 53% of New Graduates are Jobless or Underemployed; Rude Awakening for Class of 2012; Useless Degrees; Who Benefits From Student Aid?:
“Just what job does someone majoring in Political Science, English, History, Social Studies, Creative Writing, Art, etc., etc., etc., expect to get?
Arguably, graduates in those majors (and many more) should be thankful to get any job. … those who do land a job should therefore be considered fully employed, not underemployed.”
Is college education simply less valuable than in the past
I think the college grad unemployment issue raises the bigger question of whether college education is simply less valuable now than in the past.
A few years ago, I asked the question Who Are the Unemployed? The answer I found was largely those without a college degree.
But now it seems that we are seeing the effect of a bubble in college degrees.
When there were fewer graduates, a generic college degree used to be a valuable credential. Now that the market is flooded with applicants holding Bachelors degrees, those degrees count less, and specific skills count more. The result? – High college grad unemployment.
According to the Census (Educational Attainment in the United States: 2011 – Detailed Tables – U.S. Census Bureau),
“the number of Americans under the age of 25 with at least a bachelor’s degree has grown 38 percent since 2000. “
The job market has not been able to keep up with this glut in the highly educated workforce, and this has led to falling wages and college grad unemployment we see today.
Lower student loan rates are not the solution – that only encourages even more debt.
The message here is clear: parents should encourage useful college degrees, or none at all for their children.
It doesn’t take a degree to be an entrepreneur, or the next Stephen King or Picasso. Either follow your passion and make it work, or get a useful degree to fall back on. The free ride is over for college grads.
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