By Mary Beth Marklein @mbmarklein
Not to discredit all those tales of newly minted college graduates living in their parents' basements while looking for a job, but an analysis of federal data shows that as a group, young adults with bachelor's degrees are faring much better than their less-educated counterparts.
Findings, which complement multiple studies showing that a college degree significantly increases a young adult's chances of gaining economic security, suggest that the advantage held true through the recent economic recession.
"Despite the recession and the labor market outcomes that individuals experience, the college degree still offers a great deal of potential," says Diana Elliott, research manager for the Pew Charitable Trusts project on economic mobility. Though college graduates face "real and troubling" challenges finding good jobs, they remain better positioned to overcome them, she said.
Using the U.S. Census Bureau's Current Population Survey data, the study compared job and salary trends for adults ages 21 to 24 from 2003 and 2011. Researchers sought to capture employment patterns before, during and after the recession, which the study defines as having run from December 2007 to June 2009.
- Jobless rates were most severe for young adults with no college degree. Employment rates before and after the recession declined 7% among bachelor's degree holders, 11% among associate's degree holders and 16% for those with only a high school diploma.
- All groups saw wage drops during the recession, but the falloffs stabilized most quickly for bachelor's degree holders. Average weekly wages dropped 5% for bachelor's degree holders, and twice that (10%) for workers with high school diplomas only. Associate's degree holders took the steepest hit, 12%.
- College graduates continued to be employed in relatively high-status jobs at higher rates than their less-credentialed counterparts, and declines in the proportion taking jobs that did not require a college degree were modest - 3% vs. 6% for associate's degree holders.
Although the non-working population increased for all three groups studied, researchers found little evidence that significant numbers of young adults were investing in more education or training.
During past recessions, young adults were typically encouraged to pursue additional schooling as a shelter against the economic downturn and to improve their chances of getting a better-paying job in the long term.
Elliott said the Pew study did not explore factors contributing to enrollment trends. Economist Heidi Shierholz, lead author of a study last May on the labor market prospects for the college graduating class of 2012, speculates that rising levels of student debt and declining family wealth played a role.
"We could be having some adjustments (in which) those who are sheltering in school are being offset by those who can't find a job so they have to quit school," says Shierholz, an economist with the Economic Policy Institute. Similarly, she says, "if your parents just saw the value of their house (drop), they might be much less able to help you finance college."
Shierholz, who has not reviewed the Pew study, cautioned that job opportunities for young people "remain very much at crisis levels" and that the data support anecdotal stories of recent graduates struggling to find work.
"There's a much bigger group (of young adults) who are neither working nor in school," she said. "And it does beg the question, how are they getting by?"