What has happened to the college graduates who received their diplomas last Spring? Since that time, the word on the street—or at least on Wall Street—is that we are no longer in recession. But the improving public mood has not translated yet into hiring. According to the Bureau of Labor Statistics, the overall unemployment rate inched up to 9.8% in September, with no demographic group being spared.
On the surface, the 9.3% unemployment rate for college grads with a bachelor’s degree under the age of 25 seems quite positive. After all, the National Association of Colleges and Employers survey of 16,000 college seniors, conducted through April 30, 2009, concluded that only 19.7% had jobs lined up by graduation. Unfortunately, the Bureau of Labor Statistics data hide some more troubling information. The employment numbers are higher than expected, because they include college graduates who did any work during the previous week—even if that work was part-time work while they were in graduate school, and even if the work did not require a college degree.
A better way of assessing the severity of the situation for recent grads is to compare employment data on 2009 graduates, to the same data, from the same month in 2008. The percentage of this cohort who are in the work force (employed or actively looking for work), is almost identical to a year ago, indicating that there was, in fact, no rush to graduate school. What is strikingly different is the change in both the number and the percentage of young college graduates seeking work compared to a year ago. The unemployment rate in September, 2008 for those with just a bachelor’s degree was 6.6%, compared to 9.3% a year later. In September, 2009, there were 202,000 young college graduates looking for work–54,000 more than in the same month last year. The situation is even worse for men. Their unemployment rate in September was 11%, compared to under 8% for women.
Peter Coy, who penned an article in Business Week on October 8, 2009, talks about the hazards of long term unemployment at the beginning of a career: “For people just starting their careers, the damage may be deep and long-lasting, potentially creating a kind of “lost generation.” Studies suggest that an extended period of youthful joblessness can significantly depress lifetime income as people get stuck in jobs that are beneath their capabilities, or come to be seen by employers as damaged goods.”
So who is helping the Class of 2009 find opportunities and contribute to the economic recovery? Many alumni associations and careers offices have started to provide more services to their constituents, but their efforts often fall short due to lack of appropriate staffing, time or budget to help those who have already left school. Given the increasing cost of education and the decreasing value of a college, higher education needs to take more responsibility for the success of its graduates. And that success has to start with a job. While the cost of providing alumni career services may seem steep, it is money well spent. A college graduate who is given assistance when he or she needs help, is the one who will keep giving back to a college through increased engagement and philanthropy.
Graduate unemployment is not just a problem to be solved by the Career Services office, or the Alumni Association. It’s an institution-wide issue. Now is the time for discussion and action at the highest level of college and university administration. The Class of 2009 needs immediate help.
Update for October, 2009: The unemployment rate for college grads aged 20-24 is heading downwards. There was a .4% drop in the unemployment rate from 9.3% to 8.9% from September to October. But the rate of unemployment is still almost 40% higher than in October a year ago.
Note: Essential employment data on higher education, college graduates and Career Services is updated every month on this website.