College is sold to young Americans as a ticket to a better job and life by giving them knowledge and tools to increase their earning power over their lifetime. But for millions of college graduates, graduation is followed by severe student loan debt and a low paying job.
With an average student loan debt of near $30,000 and 13 million more college graduates in America than there are jobs that require a four-year degree, nearly half of recent U.S. gradsare now accepting low-wage jobs so that they can begin to chip away at their student loan debt.
According to research by the Alliance for a Just Society, because of the $1.2 trillion collective student loan burden, young adults have less ability to purchase homes, cars and other staple purchases that serve as the backbone of the economy. Hand-in-hand with this trillion dollar mountain of debt is the severe emotional stress created by underemployment on graduates – stress and anxiety that may keep them from finding work related to their college degree.
College graduates working low-wage jobs outside of their degree field suffer from highly increased feelings of shame, failure, and depression. A researcher quoted in the piece by Ryan Alberti states that such emotions can be “completely immobilizing …debilitating their ability to continue searching for better work.
Those feelings of frustration increase the longer they remain underemployed, and with the average American job search taking around five months, there is a higher likelihood of graduate workers feeling trapped by and remaining at their current job, even if they are overqualified.
Accepting any available job to pay off student loans makes recent graduates less likely to receive interview requests by potential employers in their field of study. Employers are 15-30 percent less likely to extend an interview request to applicants who display a period of underemployment on their resume, meaning the longer their underemployed – note, not unemployed – the more difficult it is to obtain interviews for positions that actually require the graduate’s degree.
This contributes to the already large problem that college graduates earn 10-15 percent less over the first decade of their careers when graduating during or shortly after a recession due to decreased numbers of jobs that require a college degree and downgrades in pay for jobs that do require a degree.
This leaves a grim outlook for our recent and soon to be college graduates. The outlook is even worse for workers without a college education when more college graduates accept low-wage positions. As our jobless recovery continues, unemployment nationally has reached 10.6 percent for those without a college education (compared to 3.7 percent for college grads).
That number, already too high, is actually even higher as it fails to account for the portion of non-college educated workers who have given up their job search in discouragement (among young persons, non-college educated persons aged 25-34 have the lowest participation rate in the American job market at 77 percent).
From 2002-2012, the proportion of minimum wage workers with a high-school education or less fell as the proportion of degree-holders working minimum wage jobs rose, indicating an effect of lower education workers being pushed out of the labor market.
Bringing together all of this data as a whole, it’s clear that the American workforce is fundamentally changing. More college graduates find themselves underemployed and scraping by to pay college loan debt. Meanwhile, an even greater number of people without a college degree find themselves unable to even scrape by as they become displaced in the work force by college grads accepting lower wage work.
Now is the time to reinvest in the American higher education system, the workforce, and the economy by making college more affordable and creating incentives for employers nationwide to pay a living wage for their workers. A college education should not result in diminished career prospects. A lack of a college education should not doom a person to poverty.
Both of these issues are linked, and cannot be completely solved individually. We must mend our broken promises to our young college graduates and make life affordable to all of our fellow citizens, regardless of education.