College graduates have fared better than workers without degrees during the economic recovery, as their unemployment rate fell to 3.9 percent according to data released in May. That’s far lower than the 7.5 percent overall unemployment rate.
For recent college graduates, though, the unemployment rate doesn’t tell the full story. According to a new report from McKinsey & Company, nearly half of America’s recent graduates say they are working in a job that does not require a college degree. Instead, they are working as waiters, salespeople, or in other low-wage jobs, the survey found:
[T]he most striking finding from our survey may be the extent to which recent graduates find themselves in jobs that they say do not require a college degree. Overall, nearly half say this is the case, though graduates of public universities are 11 percent more likely to feel overqualified than those who attended private universities. [...]
For example, assuming that our sample is broadly representative of the nation’s 1.7 million college graduates last year, roughly 120,000 Americans who would rather work elsewhere took jobs as waiters, salespeople, cashiers, and the like. That’s one every five minutes.
The survey echoes recent data from the Bureau of Labor Statistics that showed college graduates are increasingly turning to low-wage jobs when they finish school. 284,000 college graduates are working minimum wage jobs according to the BLS, more than double the number that worked such jobs before the Great Recession.
That’s largely because low-wage sectors have dominated the economic recovery, accounting for a majority of the jobs added since the recession’s end even though they made up just 21 percent of jobs lost during the downturn. Mid-wage jobs that generally go to recent college graduates, by contrast, made up 60 percent of recession losses but just 21 percent of gains since it ended.
That has broad implications for the American economy, as recent graduates working in low-income jobs are less able to contribute to economic growth through the purchase of houses and other goods, particularly as they remain overburdened by student loan debt. Worse, those low-wage jobs are less likely to provide substantial retirement or health benefits, and working for low wages immediately out of college leaves workers behind for the rest of their lives, meaning they will lag older generations in income, savings, and wealth accumulation for years to come. (HT Huffington Post)