There Are Still Employment Benefits with a College Degree
Two weeks ago, I shared the results of a recent study by the Pew Charitable Trust entitled, “How Much Protection Does a College Degree Afford? The Impact of the Recession on Recent College Graduates.” This study focuses on the practical issues of finding a job and earning money.
It is not an opinion piece. Rather, the study provides a series of analyses drawn from the data collected in the Current Population Survey (CPS) from 2003-2011. The CPS is administered monthly and sponsored jointly by the U.S. Census Bureau and the U.S. Bureau of Labor Statistics (BLS).
The Pew study focused on recent college graduates (aged 21 to 24). And the data is clear … a college degree is still the best investment for career opportunity and the best protection from a downturn in the economy. It is clear that all young workers were impacted by the recession with fewer jobs and lower wages. But what this study reveals is that the declines for college graduates were far less severe than those without this level of education.
Here are some of the conclusions taken from the report:
Before the recession, just over half (55 percent) of young adults with a high school degree (HS) were employed, compared with almost two-thirds (64 percent) of those with an associate's degree (AA) and 7 in 10 (69 percent) of those with a bachelor’s degree (BA).
Job losses during the recession made existing employment gaps even worse. The employment declines for those with HS and AA degrees were 16 and 11 percent, respectively, compared with seven percent for those with BA degrees.
Before the recession, BA graduates had more than twice as many college-level jobs as AA graduates and more than four times as many college-level jobs as HS graduates. This advantage did not deteriorate during the recession. Six percent of the HS and AA groups lost college-level jobs compared with only three percent of BA graduates.
Although wages decreased for all education groups, the decrease was less pronounced for recent four-year college graduates. The decline in weekly wages was only five percent for BA graduates, whereas the corresponding declines were as high as 12 and 10 percent for AA and HS graduates, respectively.
During the recession, the non-working population increased in size for all three education groups, but the share of that population attending school did not increase. Approximately two-thirds of all non-working graduates were attending school, a proportion that did not differ much by degree type.
The proportion of BA degree-holders who made the transition from being excluded from the labor market (i.e., not working or in school) to employment barely changed during the recession.
By contrast, the proportions of HS and AA graduates who found employment declined significantly with the recession—by approximately 10 percent for those with AA degrees and eight percent for those with HS degrees.
The findings show that the deteriorating market situation of recent college graduates, while real and troubling, is nonetheless less extreme than that experienced by less-educated groups.
There is no doubt that the end of the recession and economic growth will benefit everyone. But this study provides some good news for those working on their degrees.
(As always, your comments and questions are welcome.)