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Report Reveals Half of Graduates Are Underemployed


With declining confidence in higher education among the American public in recent years, policymakers have increasingly emphasized the concept of return on investment. Put plainly, they argue that students who dedicate time and financial resources to obtaining a college education should experience an increase in earnings as a result of their degrees.

Report Reveals Half of Graduates Are Underemployed

(Photo : UNSPLASH / Shridhar Gupta)

Examining Underemployment

A recent analysis carried out by researchers at the Strada Institute for the Future of Work and the Burning Glass Institute aimed to expand the conversation beyond income by investigating the kinds of jobs obtained by graduates. Their notable finding indicated that 52% of individuals holding a bachelor’s degree are underemployed within the initial year after graduation, indicating they are employed in roles that don't typically require a college-level credential. Over a decade, this percentage decreases slightly to 45%.

Other researchers have said that number seems higher than they would expect. However, focusing on what type of jobs students expect to have — and not just how much they will earn — may offer colleges new insight into how to meet those expectations.

As an example, experts suggest that policymakers and educational institutions should allocate resources towards enhancing career counseling services and improving transparency regarding students' post-graduation career paths. Additionally, colleges ought to promote the availability of paid internships as they have been shown to substantially reduce the likelihood of graduates experiencing underemployment.

READ ALSO: Rethinking Education and Employment in Post-Pandemic US: What Employers Need from Students

Major Factors and Skepticism

Among their findings: Underemployment is sticky, making a graduate’s first job out of college crucial. Of those who get a college-level job shortly after graduation, 79% remain in one five years later. Underemployment also varies by college major. Students in fields that require substantial quantitative reasoning are much more likely to be in college-level jobs than those in fields like public safety, recreation and wellness, and marketing.

Not everyone is convinced that researchers can reliably categorize jobs as college or high-school level — or that doing so will provide important insights into student outcomes.

According to Jeff Strohl, the research director at the Georgetown University Center for Education and the Workforce, the majority of positions are filled by individuals with varied educational backgrounds. Strohl highlighted that individuals with bachelor’s degrees often experience an increase in earnings compared to those with only a high school diploma, even if they hold similar job titles. This suggests that graduates demonstrate higher productivity, leading employers to recognize and reward their skills.

Strohl also pointed out that while earnings are important, students' interests and fulfillment should also be considered.

The Importance of Postsecondary Education

Despite concerns about underemployment, experts agree that postsecondary education remains crucial in today's economy. Michael Itzkowitz, president of the research and consulting firm HEA Group, emphasized that college offers benefits beyond just economic ones, including greater health, happiness, and civic engagement.

Furthermore, ensuring that students have access to comprehensive support services, including mental health resources and financial aid counseling, can help them navigate the challenges of transitioning from college to the workforce. Colleges should also foster partnerships with local businesses and industries to provide students with internship and job placement opportunities aligned with their fields of study. By taking a holistic approach to student success, colleges can better prepare graduates for meaningful careers and contribute to overall societal well-being.

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