Despite a recovery that has resulted in an unemployment rate that is the lowest it's been in nearly a decade, many college graduates still hold jobs that don't require a college degree, Steve Matthews reports for Bloomberg.
Economic recovery since 2010 has generally been robust. The unemployment rate is currently at 4.7%, and 180,000 jobs were added last month; 235,000 in the month before that. Mass underemployment was thought to be a temporary effect of the 2007-2009 period of the recession.
However, newly released data from the Federal Reserve Bank of New York shows that 44% of college graduates are employed in jobs that do not require a college degree. These individuals often make less in wages than their peers who are in jobs that do require a college degree.
This is troubling to Jesse Rothstein, a former chief economist at the Department of Labor, who argues that the U.S. labor market still has more educated workers than it has jobs for them.
Jaison Abel, an economist with the New York Fed, has reached similar conclusions in his research. He argues there has been a decrease in the demand for cognitive skills since the 1990s. Federal Reserve research also suggests more cyclical causes for the gap, such as limited jobs for liberal arts graduates, the inability to relocate for a job, and familial responsibilities.
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Notwithstanding the underemployment rate, Abel says college is still worth it. People with college degrees have higher wages and lower unemployment rates than those without a degree. College grads are also more likely to own a home (Matthews, Bloomberg, 4/6; Federal Reserve Bank of New York report, accessed 4/7).
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