Have degree, driving cab: Nearly half of college grads are overqualified
New study finds that 48 percent of college graduates are in jobs that do not require a college degree, fueling consumer doubts over whether a college education is worth the cost.
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Some of the findings:Skip to next paragraph
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- If prosperity depends on education, it will also depend on creating jobs to make use of it. Citing forecasts from the Bureau of Labor Statistics, the CCAP study says the US will add about 19 million college degree holders during the decade that ends in 2020, while the number of jobs requiring a bachelor’s degree is expected to grow by only about 7 million.
- The “overqualified worker” is much more prevalent today than in 1970. The share of retail clerks who had college degrees back then was less than 5 percent, and has risen more than fourfold since then.
- The economic value of college varies a lot by major. The average mid-career salary for an electrical-engineering grad is currently about twice that of a person holding a degree in music.
Mr. Vedder, the director of CCAP, says that many young Americans are spending money – and going into debt – not so much for skills as for an edge in getting hired. An employer may not require a degree holder for a given job, but can use a degree as a “screening device” to narrow the pool of job applicants.
Critics of Vedder’s view say that many employers, even if they don’t officially require employees to have college degrees, reap higher productivity by hiring them.
They also say the wage patterns of recent decades show that the economy is demanding more education, not less. A 2011 report by Georgetown University’s Center on Education and the Workforce noted that some economists as far back as the 1970s were worrying about the “overeducated American.”
“It turned out that the critics’ predictions were startlingly shortsighted,” said Anthony Carnevale and Stephen Rose in the 2011 report. “Instead of declining, earnings for college-educated workers grew rapidly throughout the 1980s and 1990s, outpacing growth in earnings of their less-educated counterparts. The gap between these relative wages widened significantly.”
They argue that technology is a driver of this trend, “as unskilled labor is increasingly automated and employers look for workers who can productively utilize the latest technological products.”
Add up the evidence on both sides, and it may suggest a few things. Higher education makes sense for many; but for many others, the best path beyond high school will be less-expensive vocational learning. Changing technology will expand the need for learning new skills throughout one’s career, not just before age 22. Universities may come under greater pressure to hold their costs down or to justify high tuition rates.
A sign of the times: Moody's Investors Service recently downgraded its outlook for the higher education sector, given the threat of declining enrollment, government funding cuts, and customer doubts over the tuition’s value.