A regular topic for discussion is the US employment rate, which is near a historic low. But a new article on Yahoo! Finance by Sibile Marcellus reports that United States underemployment for recent grads is worse today than it was in the early 2000s.
How is the underemployment measured?
Since 1940, the bureau of Labor Statistics (BLS) uses six alternative measures to quantify underemployment or Labor underutilization, all of which are based on the Current population survey (CPS). Per the BLS, “unemployment… includes all jobless persons who are available to take a job and have actively sought work in the past four weeks.” Underemployment commonly includes total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers.
Today, the BLS reports recent graduates are taking jobs that do not require the degree they worked several years to obtain. Are the college degree jobs gone? No. But there are more graduates holding a college degree so just having the degree no longer makes a graduate stand out. Additionally, According to the BLS, graduates are taking blue collar or e-commerce jobs because currently, the pay tends to be better as a way to draw more to a field with worker shortages. Following recent education trends, your teacher may have encouraged you to avoid blue collar work and focus on college education requirements. Then your degree, which costs an inordinate amount of money, earns you a job paying less than the blue collar trade you were encouraged to leave behind. So where are those great paying jobs for those with that college degree?
Gallup, as in Gallup polls, who has bragged that ‘we know more about the will of employees, customers, students and citizens than anyone in the world” says what the whole world wants, is a good job.” Gallup refers to a good job as one “with mission, purpose, that people are really good at, with a great living wage.”
In the book, NOT WORKING: Where Have All the Good Jobs Gone? author David G. Blanchflower states underemployment is most commonly measured by quantifying the number of involuntary part timers as a percent of the total work force. It only contains the barest of information on what hours are worked, not on what hours are preferred and ignores the isue of whether the position held matches the employee’s qualifications. Since the great recession in the United States, underemployment no longer follows unemployment closely, and should be considered a separate issue. Is it any wonder that half of the educated graduates seeking employment, are dissatified with theire job options?
The Cost of Underemployment:
If underemployment is defined by the rise in part-timers as a percent of the work force, then the risk of student loan defaults is a real concern. If close to one million people are first time defaulting on student loans each year, comprehending the real problem of underemployment and its effects on our economy becomes every more relevant. Not being able to get a decent paying full time job after gradution could be one of the reasons for the skyrocketing default rate.