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ERIC Number: ED539373
Record Type: Non-Journal
Publication Date: 2013-Jan-24
Pages: 38
Abstractor: ERIC
Reference Count: N/A
Why Are Recent College Graduates Underemployed? University Enrollments and Labor-Market Realities
Vedder, Richard; Denhart, Christopher; Robe, Jonathan
Center for College Affordability and Productivity (NJ1)
Increasing numbers of recent college graduates are ending up in relatively low-skilled jobs that, historically, have gone to those with lower levels of educational attainment. This study examines this phenomenon in some detail, concluding: (1) About 48 percent of employed U.S. college graduates are in jobs that the Bureau of Labor Statistics (BLS) suggests requires less than a four-year college education; (2) The proportion of overeducated workers in occupations appears to have grown substantially; in 1970, fewer than one percent of taxi drivers and two percent of firefighters had college degrees, while now more than 15 percent do in both jobs; (3) About five million college graduates are in jobs the BLS says require less than a high-school education; (4) Comparing average college and high-school earnings is highly misleading as a guide for vocational success, given high college-dropout rates and the fact that overproduction of college graduates lowers recent graduate earnings relative to those graduating earlier; (5) Not all colleges are equal: Typical graduates of elite private schools make more than graduates of flagship state universities, but those graduates do much better than those attending relatively non-selective institutions; (6) Not all majors are equal: Engineering and economics graduates, for example, typically earn almost double what social work and education graduates receive by mid-career; (7) Past and projected future growth in college enrollments and the number of graduates exceeds the actual or projected growth in high-skilled jobs, explaining the development of the underemployment problem and its probable worsening in future years; and (8) Rising college costs and perceived declines in economic benefits may well lead to declining enrollments and market share for traditional schools and the development of new methods of certifying occupation competence. (Contains 12 figures, 4 tables, and 65 notes.) [This paper was written with the assistance of Anthony Hennen, Harrison Cummins, Daniel Garrett, Joseph Hartge, and Nicholas Wetzel.]
Center for College Affordability and Productivity. 1055 Thomas Jefferson Street NW Suite L 26, Washington, DC 20007. Tel: 202-621-0536; e-mail:; Web site:
Publication Type: Reports - Research
Education Level: Higher Education; Postsecondary Education
Audience: N/A
Language: English
Sponsor: Searle Freedom Trust
Authoring Institution: Center for College Affordability and Productivity (CCAP)
Identifiers - Location: United States