Source: Flickr / Gabriel Pollard.
Colleges and universities all over the country will soon be launching scores of fresh-faced new graduates, most of whom will be eager to begin their working lives in a well-paying, degree-appropriate position. Unfortunately for many, that dream will soon turn to disappointment as they find themselves either unemployed, or accepting jobs beneath their expectations.
So many degrees for so few jobs
The news isn't all bad. The National Association of Colleges and Employers announced recently that companies say they plan to hire 8.6% more recent college graduates this year compared to last, up from an estimated 7.8% last fall. But that will be small comfort for newly minted graduates that wind up being underemployed – sometimes earning minimum wage, or less.
According to the Bureau of Labor Statistics, 231,000 bachelor's degree recipients were working at jobs that paid minimum wage or less last year, a slight improvement from 2012, when 242,000 labored under those circumstances.
In each case, we're talking about over 10 million persons with four-year degrees, so these numbers may seem minimal, at 2.1% of all workers. But, go back to 2007, when the BLS reported only 1.3% of 11 million four-year degree holders working at or below minimum wage, and you can see that times haven't changed for the better.
That's not all. Those jovial statisticians at BLS have done some extrapolating into the occupational future of U.S. workers, and the projections aren't kind to college graduates. For jobs requiring a four-year diploma or higher, the projected number of jobs is expected to increase by 2022 by approximately 4,230, while the number of positions that only need a high school diploma – or less – will increase by 8,790. To put it all in perspective, check out page 13 of the BLS' listing of job groups that are predicted to have oodles of openings over the next eight years. Out of 30 sectors, only three require a bachelor's degree.
Quantity vs. quality
You might think that the lion's share of these occupations pay next to nothing, but that isn't necessarily true – though the majority pay quite a bit less than those that hire college graduates.
As a college graduate, you may earn a median salary of either $53,400 as an elementary school teacher, or over $90,000 as a software developer. With just a high school degree, you could find work earning $19,510 as a child care employee, or make over $54,000 annually as a sales representative in the wholesale and manufacturing industry.
While it still seems obvious that a college diploma will net you a better job and higher pay, the jobs in that particular category seem to be decreasing. Meantime, the incidence of employers looking to hire low-paid interns right out of college seems to be on the rise. Though internships are much more prevalent now than they were 20 years ago, they often don't lead to paying jobs – even if the internship was unpaid.
Might some of these low- and unpaid positions more appropriately be made into real jobs? With nearly 97% of companies saying that they plan to hire more co-op students and interns this year, this trend seems to be on the upswing. Notably, the most desirable interns are those obtaining bachelor's degrees; and, with the average hourly rate for such interns sitting at $16.35, it looks like employers are likely saving pots of money by using internships, rather than hiring full-time workers.
These examples seem to infer that the problem is the dearth of jobs that are available for the college-educated, rather than an over-abundance of graduates. Although this doesn't mean that a four-year degree is no longer valuable, students need to be more mindful than ever of the career path they choose – lest they wind up on the occupational equivalent of the road to nowhere.
