May 30, 2014

5 facts about today’s college graduates

Graduation season is in full swing, but what do we really know about all those fresh-faced young adults in black robes — what they actually studied, what their chances are of landing a decent job, how they’ll look back on their college years? Here’s our data roundup:

CollegeGrads_11 Only about 56% of students earn degrees within six years. The National Student Clearinghouse, a nonprofit verification and research organization, tracked 2.4 million first-time college students who enrolled in fall 2007 with the intent of pursuing a degree or certificate. The completion rate was highest (72.9%) among students who started at four-year, private, nonprofit schools, and lowest (39.9%) among those who started at two-year public institutions.

2 Business is still the most common major. According to the National Center for Education Statistics, about a fifth (20.5%) of the 1.79 million bachelor’s degrees conferred in 2011-12 were in business. Business has been the single most common major since 1980-81; before that, education led the way. The least common bachelor’s degrees, according to the NCES, were in library science (95 conferred in 2011-12), military technologies and applied sciences (86) and precision production (37).

CollegeGrads_23 It’s harder for new graduates to find good jobs. It’s no secret that unemployment among recent grads remains higher than it was before the Great Recession. But in a recent report, the Federal Reserve Bank of New York went deeper and looked at underemployment among recent grads (defined as people aged 22 to 27 with at least a bachelor’s degree). The Fed researchers used data from the Census Bureau and the Bureau of Labor Statistics to examine whether employed grads were in jobs that typically required a college degree, what those jobs paid, and whether they were working full- or part-time. They found that in 2012, about 44% of grads were working in jobs that didn’t require a college degree — a rate that, while about what it was in early 1990s, increased after the 2001 and 2007-09 recessions. Only 36% of that group were in what the researchers called “good non-college jobs” — those paying around $45,000 a year — down from around half in the 1990s. The share of underemployed recent grads in low-wage (below $25,000) jobs rose from about 15% in 1990 to more than 20%. About one-in-five (23%) underemployed recent grads were working part-time in 2011, up from 15% in 2000.

4 But graduates still out-earn people without degrees. A Pew Research Center report from earlier this year looked at earnings of Millennials (those born after 1980) who usually worked full-time in 2012. Among that group, workers with at least a bachelor’s degree had median annual earnings of $45,500, well over the medians for people with only some college ($30,000) or a high-school diploma ($28,000). The gap has widened over the years and across the generations: In 1965, when the members of the Silent Generation were 25 to 34 years old, median earnings for high-school graduates were 81% of those for college graduates; in 2013, among the Millennials, it was 61.5%.

5 Most grads think college was worth it. The same Pew Research report found that majorities of graduates in all three of the largest U.S. generations — Boomers, Gen-Xers and Millennials — agree that college either has paid off or will pay off, given what they and their families invested in it. Perhaps not surprisingly, the highest-earning graduates were the most positive about their educations — 98% of those making six figures and up said their degree had paid off, compared with 63% of graduates earning less than $50,000. Similarly, people with advanced degrees were even more likely than bachelor’s and associate’s degree holders to say their education was worth the investment — 96%, compared with 89% and 76%, respectively.

Category: 5 Facts

Topics: College, Education, Educational Attainment

  1. Photo of Drew DeSilver

    is a Senior Writer at the Pew Research Center.

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13 Comments

  1. William1 month ago

    Entrance into college selects for those with average or above average IQ and/or family wealth so it is not surprising that they earn more. It would be interesting to do a “twins” study and look at identical twins one of did and the other of which did not attend college. I would be willing to bet the difference would not be as great we see in all these uncontrolled studies.

    Reply
  2. Danielle5 months ago

    Where’s #5?

    Reply
  3. JMC5 months ago

    I don’t see the fifth point.

    Reply
  4. Penny6 months ago

    If the supply of college graduates increases while technical change reduces the number of jobs requiring the skills of a college graduate (whatever these may be), the price college educated workers will be able to charge for their work will fall.

    In addition if the kinds of jobs being created have less opportunity for unionization, professionalization or other type of collective governance power, people working those jobs will earn less.

    Last but not least if government jobs are being outsourced in unprecedented numbers to private oligopoly contractors, the tax payer will pay more, the worker will get lower pay the the contractors–such as Haliburton–will make a lot of money

    No one seems to smell the coffee: higher education is no longer willing, able or likely to ensure a middle class life.

    Reply
  5. Declan Fallon6 months ago

    Better to start a business than to study it in college?

    Reply
  6. app hinge6 months ago

    Like the way of explaining that even having a degree you need to struggle hard for a good job in point 3. Pew great statistics about graduates.

    Reply
  7. Margaret Ann Elder6 months ago

    A college or university education is important because it should produce more learned individuals who are capable of higher thinking and enjoy continued learning and research. Constantly equating earning higher degrees with higher salaries earned diminishes the value of becoming a learned person in general. Also, such comparisons are hurtful to liberal arts majors, who, in my opinion, derive the greatest benefits from colleges even though their subsequent salaries may not reflect that.

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    1. Josiah6 months ago

      With all due respect, I strongly disagree. I will be entering Penn State University this fall and am very dissapointed in the cost ( I am even in-state) and the broad curriculum. Liberal arts majors generate among the least salaries because they are alright at everything but expert at nothing. A college education should not provide a broad education; it should be highly specialized and focus on one area. A liberal arts education robs individuals of pursuing their passions. You will never succeed at everything but if you devote yourself to one area you will inevitabely be a success. I am going to college (business school actually) to learn what I need to know to generate revenue for my future employer, not to acquire a bunch of useless, inapplicable knowledge that I paid tens of thousands for.

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      1. Marie6 months ago

        And with all due respect to you, sir, problem-solving studies repeatedly show that those who have a broad base of learning find more connections between different topics and are more likely to find new solutions to old problems.

        In my field, I have added value because I speak three languages, and because I have personal and academic understanding of very different aspects of my profession. It allows me better to understand where my clients are coming from and give them better advice, because I can see more possible outcomes.

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        1. Dan6 months ago

          And with all due respect, the skyrocketing costs of a college education, plus mandated course selections like African tribal arts from the 1800’s, or music history, or dances of the Renaissance, never built a bridge, or created a biological experiment. In the USA it takes 8 years to become a veterinarian, in Australia it takes 3. You will be close to a half a million in debt here while there, around 100 grand. Our colleges are pricing themselves out of reach with all of the added garbage they demand and the high prices they charge.

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      2. Tim Flaherty6 months ago

        The original purpose of the University was to make you a better person; not to get you a high paying job. It’s what you become that is most important in life, not simply direct job skills. This coming from a MBA student in Marketing that appreciated the broad range of courses a University provided to get me here. I will also continue to the PHD level soon.

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        1. Nick SanGiacomo5 months ago

          The problem with college only making you a better person, rather than getting you a high-paying job, is that the cost of college has simply risen too high. I am entering my last year of school at the College of New Jersey, and I started at a community college where tuition was only $2,500.

          Even still I will graduate with about $40,000 worth of debt because of my families financial situation, and I am in-state. The fact is for me, and for many, many more like me, it is not enough for a degree to simply ‘make me a better person.’

          Reply
  8. JL Morris6 months ago

    Love PEW. Nice to see some solid research reinforcing the value of a college education.

    Reply