The college class of 2020 entered one of the most hostile labor markets in recent history. During the first year of the Covid pandemic, employment decreased across the country. By many measures, college graduates fared best during this period, but as time passes, research is capturing just how difficult conditions are for young workers.
The National Association of Colleges and Employers (NACE) recently analyzed the outcomes for 563,000 bachelor’s graduates across 337 colleges and universities and found that only 50.2% of the class of 2020 had full-time jobs with a traditional employer (meaning they are not working as a freelancer or entrepreneur) within six months of graduation. In comparison, 55.3% of the class of 2019 graduates were employed within the same time frame.
Students who attended colleges with fewer than 2,000 students tended to do better after graduation. Closer to 62% of these students had full-time positions after six months.
“The Covid-19 pandemic had a significant effect on the job market for the Class of 2020, and our report illustrates that,” says Shawn VanDerziel, executive director of NACE. “In terms of employment within six months of graduation, 2020 graduates had the worst outcomes since we began tracking with the class of 2014.”
According to an analysis of Bureau of Labor Statistics data from January 2020 to October 2020 by Pew Research Center, 2020 college graduates saw a bigger decrease in labor force participation than those who graduated during the Great Recession.
Pew estimates that among all Americans ages 16 and older, the employment rate declined from 61% in October 2019 to 58% in October 2020.
And according to an analysis of U.S. Census, Bureau of Labor Statistics and National Center for Education Statistics data for the years 1980 to 2019 by Georgetown University researchers, college costs have increased by 169% over the past four decades — while earnings for workers between the ages of 22 and 27 have increased by just 19%.
To make matters worse, college graduates today also owe more in student debt. Adjusted for inflation, 2008 college graduates owed $24,012 in student loans, on average. In 2020, that total was closer to $36,665.
Beyond a difficult labor market, the NACE report also mentions that graduate school attendance may be another reason the class of 2020′s employment rate dipped. Just over 21% of 2020 grads pursued continuing education after receiving their bachelor’s degree, an increase from 18.6% in 2019.
The report also notes that for college graduates who did manage to secure full-time traditional employment, wages increased.
“The average starting salary for the class of 2020 was $56,576 — 3.8% greater than in 2019. In addition, the median salary rose to $54,686 — 3.7% greater than in 2019,” reads the report. “A key driver for the increase in the average starting salary was the lack of lower-paying jobs that many new graduates typically secure as their first assignment following graduation. As was the case with the increases for the class of 2019, the salary increases for 2020 exceeded inflation. The real increase in starting salaries, controlling for inflation, was 2.5%.”
“Many of the retail, hospitality and other service-focused jobs simply weren’t there, and these tend to be lower-paying,” explains VanDerziel. “As a result, most of the salaries that were reported were the higher-paying jobs, which skewed the average.”
https://www.cnbc.com/2021/12/10/50percent-of-the-class-of-2020-got-full-time-jobs-6-months-after-graduation.html....
Around 2012, I remember reading about the economies of portugal and spain suffering from 50% youth unemployment statistics. (Youth unemployment is ages 19-24) My reaction to this news was... "the united states could someday suffer from the same troubles, and we would be very much unprepared for it". When I see economic doom and gloom in foreign lands and 3rd world countries, I always think similar trends will reach the shores of america eventually. Years later, america has finally arrived to having the same 50% youth unemployment statistics spain and portugal suffered 10 years ago.
The worst part of a 50% youth unemployment rate isn't usually on the surface. Its what is not seen, reflected in an uptick of suicide rates for young adults. Rising rates of homelessness for youth. Coupled with greater incidence of substance abuse, crime and violence. It was said to have taken more than a decade for sailors to accept the explanation of scurvy being caused by lack of citrus fruits and vitamin C. It may naturally follow that it will take decades for people to adequately become informed on and respond to topics like high youth unemployment.
The learning curve of people becoming informed and competent on topics, could be greatly reduced. People might be learning and responding at greatly accelerated rates in contrast to past precedents. While current events are not great, do we all feel tempted to acknowledge that people are smarter and better informed than we gave them credit for being? Perhaps we can feel better about circumstances even if they are not ideal. And have hope for the future, in that people today might be smarter and more knowledgeable than those in past eras. It may no longer take 10 years for people to accept scurvy being caused by fruit and vitamin C deficiency. Perhaps we can respond to and fix these types of issues much more quickly now.
