The Economic Policy Institute (EPI) recently released a report on the economic prospects of the college class of 2018. This report examines the employment, income, and education trends among college graduates ages 21-24. The data refers only to those who have earned a Bachelor’s degree.
Overall, 18% of Americans ages 21-24 have earned a Bachelor’s degree, and the employment rate for this group has declined overall. This is largely because of the smaller number who are considered “employed only.” Of young adults in graduate school, about half are working as well.
Underemployment, graduate enrollment, and idling
The EPI reports that the number of young graduates working jobs that do not require a degree has been slow to fall. Additionally, more young people are working less lucrative or sustainable jobs than in the past. In 2000, those working jobs without degree requirements were more likely to be in “a ‘good’ job that tended to be more career-oriented and fairly compensated—such as electrician, dental hygienist, or mechanic,” than today. Now, there is an increase in college graduates who are working jobs with low or average wages, “such as bartender, food server, or cashier.”
However, an increasing number of Bachelor’s degree holders are returning to graduate school. The number of graduates who are enrolled has increased since 2000. This includes both graduates who are employed and enrolled simultaneously and those who are enrolled only.
Additionally, the number of graduates who are “idled,” or neither enrolled nor employed, is relatively low. Just 9.0% of young college graduates are idled.
College graduates’ recovery after the Great Recession
According to the report, “graduates’ economic prospects have begun to look up” ten years after the Great Recession. Data shows improvements to both employment and wage growth overall.
However, the while unemployment among young college grads have fallen to pre-recession levels, the rate remains higher than a peak in 2000. Underemployment is a similar story; the rate of college graduates who are underemployed has “improved somewhat” relative to a 2011 peak, but remains higher than pre-recession levels.
Outcomes are not equal
The economic outcomes for young college graduates vary by race and ethnicity. For example:
- Minority groups have lower rates of employment
- Asian American/Pacific Islanders are significantly more likely to be enrolled only
- White graduates are both the most likely to be employed only and the least likely to be idled
While men and women across all race and ethnicities have “similar idled and overall employment rates,” their wages are unequal. Despite the fact that the majority of college graduates are women, wage growth for women has been slower than for men. From 2000 to the present, women’s average wage rose from $18.22 to $18.33, while men’s rose from $20.48 to $21.48. Slow wage growth is a contributing factor to the persistent gender pay gap.
For more details on the economic outcomes for college graduates, read the Economic Policy Institute’s full report.
