Pay falls, unemployment rises for college grads
Michael Mandel calculates and contemplates the declining compensation being made by fairly young college graduates. Real earnings (2010 dollars) for male holders of bachelor degrees have fallen from $73,000 in 2000 to $59,000 in 2010. (See Mandel's graph below.) For women it's worse, with real earnings falling from $56,000 to below $48,000.
This actually doesn't give the full, bleak picture facing young college grads -- those figures are for people who are actually employed full time. And they include employees as old as 34 -- folks who have been employed for a while. Many, many grads can't find a full-time job. Mandel asks:
no one has given me a good explanation yet of why young American college grads should have been hit so hard. Is there increased competition with young college grads around the world? Are new college grads lower quality than their predecessors? Has information technology reduced the need for young grads? I really would like to know.How about this, which I wrote about a couple years ago? Slumping stocks and home values have prompted older worker to delay retirement, leaving fewer openings for young folks. From that column:
"People over the age of 55 are not dropping off the payrolls to retire early as they had been doing for years," says David Rosenberg, chief economist at Gluskin Sheff in Toronto and one of the first to identify the developing employment gap. "And then there are those who did drop out of the labor force who are coming back to secure work."
Meanwhile, he says, "we're creating massive pools of unemployment among 20-somethings."He's talking about all 20-somethings, but I don't see why the same dynamic shouldn't apply to college grads.