A side effect of the academic industrial complex and the push to have everyone have ever more higher education:
There’s a word for someone who has a job that does not require the degree they hold: “underemployed.” In 2008, over 35% of college graduates were underemployed; by June of last year, the Federal Reserve Bank of New York reported that a whopping 44% of graduates were underemployed. And it’s not just because of the recession: the number’s been rising since 2001.
And more education doesn’t’ exactly help; in fact going to graduate school can make things worse. In 2008 22% of people with PhDs or professional degrees and jobs were underemployed. That number rises all the way to 59% for people with master’s degrees.
via Overqualified and Underemployed: The Job Market Waiting for Graduates.
Colleges are producing graduates at much faster rates than market demand is increasing, particularly with regards to the Master’s degree.
In the mid-1970s, about 12% of adults had a 4 year degree or higher. Today, in the under 30 age bracket, about 1 in 3 have a 4 year degree and almost 30% of all adults have a 4 year degree. 10% have a Master’s degree.
Roughly, today’s Master’s degree is what a 4-year degree was worth in the 1970s, and today’s community college 2-year degree is what a high school diploma was worth in the market in the 1970s.
This is another way that inflation eats away at wages, as the costs of entry rise while wages fail to keep pace with the Fed’s intentional (2% per year target) devaluation of the purchasing power of the dollar.
This chart highlights that a large number of college degrees, in terms of marketplace valuation, are a bad investment in time and money:
The Federal Reserve (remember, this is a privately owned bank and not a Federal agency) writes:
“the broader V-shaped pattern in the underemployment rate over the past two decades is also consistent with new research arguing that there has been a reversal in the demand for cognitive skills since 2000.4 According to this research, businesses ramped up their hiring of college-educated workers in an effort to adapt to the technological changes occurring during the 1980s and 1990s. However, as the information technology revolution reached maturity, demand for cognitive skill fell accordingly. As a result, during the first decade of the 2000s, many college graduates were forced to move down the occupational hierarchy to take jobs typically performed by lower-skilled workers.”