The labor market for recent college graduates is improving after about two years of decline, according to two Federal Reserve Bank of New York researchers.
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"While successfully navigating the job market will likely remain a challenge, it appears that finding a good job has become just a little bit easier for the class of 2015," write Jaison Abel and Richard Deitz in a blog post.
The unemployment rate for 20- to 24-year-olds, 9.6%, remains higher than the 4.6% rate for 25- to 54-year-olds. But the number of job openings requiring a college degree has increased, which in turn has pushed down underemployment among recent colleges graduates by two percentage points since last June, say Abel and Deitz.
The duo analyzed information from Conference Board's Help Wanted OnLine database—examining only positions that usually require a bachelor's degree. They found that postings for jobs requiring a college education rebounded directly after the end of the Great Recession, but plateaued near 2013 and then declined until halfway through 2014. Such postings have increased by about 10% since last summer.
However, the rate of underemployment among recent college graduates remains "quite high by historical standards," write Abel and Dietz, who estimate nearly half are working jobs that do not require a degree.
"While the demand for college graduates appears to be picking up, significant labor market slack remains, so continued strong growth in the demand for college graduates may well be necessary to make a more serious dent in the underemployment rate," they conclude (Sparshott, "Real Time Economics," Wall Street Journal, 5/15; Abel/Deitz, "Liberty Street Economics," Federal Reserve Bank of New York, 5/15).
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