Amidst the wails of despair across the U.S. about the country’s seemingly intractable unemployment plight, something seems to have gone unnoticed -- joblessness among college graduates is fairly low, and has been steadily declining for the past few years.
The recent jobs report from the Bureau of Labor Statistics (BLS) indicated the grim news that zero new jobs were created in August of this year, with the national unemployment rate frozen at 9.1 percent. More ominous news followed when the Bank of America, the largest bank in the nation by assets, said it will lay off at least 30,000 more employees.
U.S. president Barack Obama, facing an increasingly tough re-election battle next year, has responded to the crisis by proposing a $450-billion spending plan to create jobs (a plan many Republicans have already scoffed at).
Unemployment is indeed a subject on the minds of many.
However, if one examines the August BLS jobs report closely, one finds something interesting -- the unemployment rate for college graduates (that is, those holding at least a Bachelor’s degree) is only 4.3 percent. Moreover, this figure has slowly declined from 5.0 percent in August 2010.
Or, to put it another way, more than 95 percent of college graduates in the Unites States are working – in the aftermath of one of the worst recessions in living memory.
Indeed, the more education the civilian workforce has, the greater their chance of gaining employment.
The BLS report revealed that, as of August 2011, workers with some college experience or an associated degree are facing an 8.2 percent unemployment rate; high school graduates with no college are burdened by a 9.6 percent rate; while those without a high school degree have a 14.6 percent jobless rate.
According to data from the Federal Reserve Bank of St. Louis, unemployment even for U.S. college graduates soared during the height of the recession – from just under 2 percent in 2007 to above 5 percent last summer.
Throughout the 1990s (the years of the internet/tech boom), joblessness among those with a university diploma ranged from between 3 percent and 1.5 percent.
John Slenker, a labor market analyst for the New York State Department of Labor, recently told the Buffalo News: The biggest [determinant] of whether you're going to be unemployed or not is education level. People with a bachelor's degree or highe -- their unemployment rate tends to be half of what the average is. People without a high school diploma -- [their rate] is double the average unemployment [rate].
Moreover, college graduates in the U.S. workforce, numbering almost 47-million, constitute the largest portion of the civilian workforce – perhaps reflecting how increasing common going to university has become.
In any case, these numbers seem to disprove the notion that college degrees are becoming useless (especially in light of rising tuition costs and skyrocketing student loan debt).
Indeed, while recessions do indeed hurt the employment outlook for college graduates, it does far more harm to construction and manufacturing workers without college degrees.
Granted, the cold, hard numbers do not specify what ‘kind’ of jobs these college graduates are getting – presumably, many have failed to find work in the vocations they trained and studied for and may have resigned themselves to accepting jobs at a less-than-desired salary.
Still, they are working, earning income and paying bills.
Sean M. Snaith, a professor of economics at University of Central Florida, told International Business Times: “Higher levels of educational attainment are associated with lower rates of unemployment and higher earnings over ones working lives. This is true regardless of where we are in the business cycle.”
Snaith also commented: “While the barista making your cappuccino may have a college degree and is working there as a result of the current state of the labor market, data tells us he [or she] is unlikely to stay underemployed over time.”
Palash has worked as a business journalist for 21 years in New York.