What High Youth Unemployment Means For Our Economy

Written by Chris Lewis

More than a quarter million American college graduates worked for minimum wage last year—that’s 70 percent more than ten years ago. We can all agree that’s a sign of an unhealthy economy.

But what kind of unhealthy? Is degreed underemployment just a product of the Great Recession, or does it reflect more fundamental economic problems?

In a recent paper, economists Paul Beaudry, David A. Green, and Benjamin M. Sand argue that there has been a “great reversal” in the demand for skilled labor. That is, fewer employers need to hire employees with college degrees. The Daily Beast’s Megan McArdle suggested that the findings mean “A BA is now a ticket to a job in a coffee shop.”

Ominously, the reversal began well before the recession started.

“Many researchers have documented a strong, ongoing increase in the demand for skills in the decades leading up to 2000,” the researchers wrote. “In this paper, we document a decline in that demand in the years since 2000, even as the supply of high education workers continues to grow.”

So does that mean we’re headed for an education surplus? Are those college-educated minimum-wagers here to stay?

It’s too early to tell, according to Dean Baker, co-director of the Center for Economic and Policy Research.

“I do think we will need more college grads,” Baker told Campus Progress. “The question is: do we need them at the same rate we’re producing them? And that’s just much less clear.”

To find out for sure, though, we’ll have to bring the economy back to full employment.

“Let’s assume the economy does recover five, six years out,” Baker said. “I think we’ll see a lot of college grads working at jobs that would not ordinarily require college degrees.”

However, that doesn’t necessarily mean they’ll be working for minimum wage. Even if it’s not a requirement for the job, employers will likely still be willing to shell out for the skill set and credentials provided by a college degree.

But, once the economy has recovered, if college-educated Americans still find themselves in dead-end jobs, there might be a political gain in their economic pain. As The Roosevelt Institute’s Dorian Warren said recently:

“The Millennials who are more privileged and get to boomerang are finally starting to feel and realize just a sliver…of what these groups of poor black and brown kids are experiencing, and that does open up possibilities for alliance and solidarity.”

This post was originally published by Campus Progress.

 

Photo: Kymberly Janisch/flickr

72 comments

Jeanne R
Jeanne R25 days ago

Thank you for sharing.

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Jeanne R
Jeanne R25 days ago

Thank you for sharing.

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Jeanne R
Jeanne R25 days ago

Thank you for sharing.

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Jeanne R
Jeanne R25 days ago

Thank you for sharing.

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Jeanne R
Jeanne R25 days ago

Thank you for sharing.

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Sarah Hill
Sarah Hill4 years ago

My husband has been unemployed for a year and a half.

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Liliana Garcia
Liliana G4 years ago

“I do think we will need more college grads,” Baker told Campus Progress. “The question is: do we need them at the same rate we’re producing them? No, if you need them at a slower rate then you need less of them, not more, opposite to what's stated in the first part of the sentence. This article is a little light, or should I say shallow? What BA's are not getting jobs?( Liberal Arts I presume.) If college grads are getting the jobs at the cafeterias, what's left to the rest of the urban kids with just a HS diploma? Many other things remain to be asked.

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Ken W.
Ken W4 years ago

Money makes the world go around send it my way to help kick start the spin !!!!!!!!!!!!!!!

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Sue T.
Susan T4 years ago

Does anyone remember the 70's and 80's when there were very few "good" paying jobs and people made do with what they had, worked hard and maybe worked multiple jobs to just make it?
Whys should things be different for young people now? Work hard, be responsible, learn your trade and become better. Hard work pays off in higher salaries but it takes WORK!

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Marilyn L.
Marilyn L4 years ago

The good news is more people are going to college to obtain a BA/BS degree; the bad news is there are so many that only those in the top of their classes will get jobs in the field of their choice, at least this seems to be true except for educators. And if that is not enough; a BA/BS degree is considered the minimum education level now to be hire into most jobs; it just is not enough to have a HS education. Having said that, if you really want to get to the top you need a graduate degree and you should make sure you have some good grades and a well recognize university to back up that degree.

The world is changing and evolving and we are not making the necessary changes to move along with it. We are stuck in old beliefs and tried and true methods that worked for the 20th Century workers, but they will not work going forward. We must change our education system and rethink how it needs to be set up now and for the future; along with defining how that system is going to relate to general education so our society has well educated participating, productive citizens; and how we educate for work and careers. We must rethink college education and give people more choices like vocational and technical educations. And while we are at it, we must start demanding the best and the brightest to be our educators. Change doesn’t come easy but change we must.

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