Curious Capitalist

Forget Unemployment, Time to Worry About ‘Mal-Employment’

Nearly 4 out of 10 young people are now underemployed

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Ed Jones / AFP / Getty Images

English majors of the world beware — your degree may not be worth the money you put into it, unless you go on to get a graduate qualification. I’ve been spending a lot of time recently thinking about education and the skills gap in the U.S. Some academics, like Harvard’s Rosabeth Moss Kanter, think the mismatch between the skills that are needed in today’s workforce and the skills kids graduate with is responsible for as much as a third of the growth in unemployment since the Great Recession. There’s also a vigorous debate going on about whether we should be pushing liberal-arts degrees in a world in which the majority of new jobs are going to require science, technology and math skills.

So I was interested when I stumbled on a study by a pair of Drexel University academics in the Continuing Higher Education Review that looks at this question. The results are sobering for liberal-arts types. While college graduates as a group did much better during the financial crisis and recession than those with only a high school degree (who suffered double-digit declines in employment), even young college grads are suffering from high rates of what’s called “mal-employment” — meaning, they are doing things that are much more menial than what their education trained them to do. Political scientists are working as bartenders, and English graduates are doing time as retail clerks. Channel one of the plotlines from Girls, and you’ve got the idea. From 2000 to 2010, mal-employment rose by 9.3 percentage points for college graduates between the ages of 20 and 24. Nearly 4 out of 10 young people in that group are now underemployed, and humanities and liberal-arts graduates fared the worst as a group.

It’s a problem with a big economic impact. Mal-employed college grads earn half of what their degree-appropriately employed peers do, a difference that adds up to tens of thousands of dollars per year, and millions over a lifetime. Does this make me think that my English degree wasn’t worth it? No, in part because the downwardly mobile trend is so much more pronounced for today’s graduates than those of the past. And, the study can’t capture the soft skills and creativity that liberal-arts education imparts, something I hear employers in the U.S. and abroad clamoring for. But it does make me think that unless you are a sharp kid, at a top school, you need to think long and hard about shelling out $100,000 for a degree that may net you a yearly salary of $33,265 (the average for an underemployed humanities grad). Either that, or make sure you learn some IT skills at the same time.

21 comments
BelindaBaardsen
BelindaBaardsen

Dear English Students, 

Do not listen to anyone who tells you your degree is not worth anything - that is not true! It may not be worth anything in the USA, but it is highly valued in the "world." If you take the next step and get your TEFL/CELTA; you will be certified to teach ENGLISH AS A SECOND LANGUAGE in the world. This degree along with the TEFL Certification will make you one of the highest paid employees in the world. Saudi Arabia, and other nations will pay their back teeth in gold if you would just come to their country and teach! You can make $50,000 and more - and this does not include - air fare - housing, medical, and more -- you just have to be willing to teach abroad -- if you need help with that -- contact me at: professor.of.english per skype and I will gladly direct you to where you need to go. The point is - times have changed - and we must be willing to be GLOBAL employees - take your education - down the road - and get paid. Our nation, sadly, no longer appreciates graduates with degrees because we are in a time when Corporate America is beating down the cost of educated employees - so  they pay less - even as they earn more - again, you just have to be willing to get your passport ready - along with your willingness to work in the world where your education isss valued!

RedRock
RedRock

At my top-notch liberal arts college they spent a lot of energy telling us don't worry, employers will value the ability to communicate and the analytical skills that come from an education like this.

Sounds great.  But they should have told the employers too. 

But the liberal arts degree helps in other ways. FOr example, even when you don't have a dime you can convince a creditor that he'd better not mess with you. And employers do value it, in a way.  They observe that the people who go to a school like that generally come from a family like that, and must have been brought up to hold their own among the people who actually run the world.

meddevguy
meddevguy

Maybe these underemployed were really meant to be great bartenders. But forced to invest a life savings to gain prestige among friends, family, etc. American education creates a class system. It isn't the same everywhere -- the UK, or example feels that accountants, for example, are better if they start right out of what we call 10'th grade and learn on the job.

But you want underemployed - how about 29 hours or less per week! Our President's "signature achievement" is creating as much massive underemployment as it is gaining votes -- and not making anybody any better any sooner or any cheaper. But that's because the real effort was VOTES. 

RudyVassar
RudyVassar

Where in the hell are liberal arts grads earning 33k per year?  I have an MA in history and am barely bringing in 25k from two jobs that I hate, working 65 hours per week.

mrbomb13
mrbomb13

As a 25-year old working at a major Fortune 500 company, I can attest that what Rana Foroohar writes in this article is absolutely true.

My road to that position was not easy or straight-forward.  In 2006 (when we graduated high school), we were told to 1) pursue our dreams in college, and 2) that the world was full of opportunities for people of all passions/persuasions.  At the time, the assumption was that when we graduated college (in 2010), the Baby Boomers would begin retiring en masse, thereby freeing up many positions for us to fill.

Fast-forward to 2007-2009, and we witnessed the Great Recession, where 1) much wealth was lost, and 2) Baby Boomers postponed their retirement by 5-7 years.  What that meant was the previous predictions became invalidated.  Additionally, we started hearing catch-phrases, like, "Be willing to re-invent yourself," and, "You have to be willing to be 'flexible' in this job market." 

As the article noted, we were also strongly advised to couple our liberal arts background with a technical skill.  For me, I was a History major seeking Secondary Education certification.  For others, it involved English majors seeking extensive internships, Philosophy majors seeking law school, etc..  In other words, a mere Bachelor of Arts alone would not cut it in the job market.

In my case, the recession killed teaching opportunities, so I went on the law school track.  When that proved unsatisfying, I left, and decided to pursue an MBA.  Only majoring in Marketing, I eventually earned a dual MBA in Marketing and Enterprise Resource Planning (in SAP ERP) in December 2012.    Following that, I became an Analyst with that major company referred to above, and a part-time SAP instructor at a private university.

Nowadays, I do not even talk about my History teaching experience.  Instead, through personal re-invention, I market myself as an IT Analyst who utilizes and instructs in SAP.  My willingness to venture into new fields allowed me to rise above what Foroohar labels as the, 'mal-employed' of my generation.  However, there are too many who will not venture outside of their dream field, or even their 'comfort zone.'  It is those people who are stuck working in Pacific Sunwear or working as baristas.  Their skills are not what the market demands, and they will continue to stay mal-employed until they act upon that dynamic.

vstillwell
vstillwell

The great myth that Americans aren't trained in the right fields is just stupid. I keep reading this crap from lazy journalists. They write about an obscure study that explains away all of our unemployment problems. I guess we should be a country that has 300 million electrical engineers and everything would be just awesome. 

MAGuyton
MAGuyton

Isn't it at all problematic that our society has become so utilitarian that learning anything at all about culture instead of just about machines and math equations is seen as irrelevant and obsolete? The reason that English majors are undervalued is because information is undervalued. The content that we produce is supposed to be free because everything on the internet is supposed to be free. If people actually paid for creative content like they did 20 years ago, then English majors would be doing just fine.

littleredtop
littleredtop

Let's not blame industry but place the blame where it belongs -- education and immigration.   Education because they keep telling losers that they can be anything they want to be and immigration for allowing the hundreds of millions of foreign students to flood our schools and then expect employment. 

c3pobud
c3pobud

Do we think that young people entering college choose a degree in English over a degree in Molecular Kinetics willfully? 

janeausten
janeausten

Rana Foroohar is always the best.  Claire O'connell Rana has this 82 year old lady checking her computer every day.  I have a print susbscription but have not figured out to sign up for a companion web subscrition.

JoshSoffer
JoshSoffer

@mrbomb13 "there are too many who will not venture outside of their dream field, or even their 'comfort zone.'  It is those people who are stuck working in Pacific Sunwear or working as baristas.  Their skills are not what the market demands, and they will continue to stay mal-employed until they act upon that dynamic."

Maybe, but those who have a passion for their 'dream field' may be more interested in what they demand of themselves than in what the market demands of them . Because two things are true in today's economy. 1)What are considered marketable skills undergo change faster than ever. The more narrow the training the more employable one may be today or next month, but by next year those skills may be obsolete.2.) a liberal arts background by definition contributes abstract skills that  are conducive to life-long personal re-invention, and are therefore  more adaptable to a changing market than any specific skill set.  You didn't mention if you would have been happier teaching history than in your current field. Would you go back to it if the economy allows it? Do you regret majoring in history?


Read more: http://business.time.com/2013/10/02/foroohar-forget-unemployment-time-to-worry-about-mal-employment/#ixzz2gdgpuUJg

BenDickison
BenDickison

@vstillwell I am unsure why one would say "the great myth" - there are currently 5 million jobs being advertised to be filled. It costs a ridiculous amount of money to advertise and when I was General Manager at a business a crazy amount of time and money went into trying to hire skilled people. Between the lack of skills and the attitude that they would not work nights or weekends and completely over valuing their own skills and competencies, hiring people is nearly impossible. 

Businesses do not spend all this money advertising and recruiting because they do not want to hire, they spend it because they cannot find the right people to hire. And then all the people that did not get the job because of their over inflated impression of their own worth tell the stories of how they were not really hiring anyway... 

SteveGaines
SteveGaines

@littleredtop I bet you weren't a math major.  Immigration may have let in millions of foreign student, but not hundreds of millions.  There's only about 300 million people in the US total.

BenDickison
BenDickison

@c3pobud Yes. Millions of students in Art History, a  bachelors program in Oceanography, the plain liberal arts degrees mentioned here, drama, and an endless list of other equally unemployable degrees or degrees with known starting pay and potential so minimal that it is ludicrous. If you want sobering look at the Federal Student Loan defaults broken down by degree concentrations. 

These kids are being told any degree is worthwhile and a good idea and encouraged to take on tens of thousands in debt by over zealous guidance counselors that just want a big number for "accepted to college" and and University recruiters trying to fill departments with students. Mix this with an 18 year olds warped sense of responsibility and complete lack of understanding of even basic economics like "Need job to pay bills is more important than dream job you will never get" and it is a recipe for poor decisions leading to years of hardship and regret. 

Want to fix half of what is wrong with american education and work force? Quit telling the ridiculous lie "you can be anything you want to be"  and start basing cute soundbite phrases in reality. 

gemeinerpfennig
gemeinerpfennig

@c3pobud I did. I could have gone into anything, but chose what I loved. I'm not the slightest bit ambitious & don't regret it. I'd feel rich if I could nail the $33,265/year mentioned in this article!

mrbomb13
mrbomb13

@JoshSoffer @mrbomb13

First, thanks for your reply.  Just a couple of comments:

1) I completely agree with you that, "those who have a passion for their 'dream field' may be more interested in what they demand of themselves than in what the market demands of them."  However, my main concern is whether that passion/interest is enough to pay bills, put food on the table, etc..  While I do not advocate abandoning one's passion, I would strongly advocate (as mentioned in my original comment) that such individuals have a 'Plan B' (i.e. having technical training).  That ensures one is not a, 'one-trick pony' in (as you mentioned) an ever-changing economy.

2) As to your question of whether I regret my History major, the answer is that I do not.  My passion for History/global affairs runs deep, and I appreciated the years spent learning how to better appreciate and analyze the past. 

3) With that being said, I'm equally thankful that I coupled that passion with my training as a teacher.  The training helped me to effectively impart that passion on to my students, and inspire their curiosity. 

As to your question of, "would I go back," the answer is that I have never really left the field.  In my place of business, my colleagues and I are currently teaching recent hires about our business, and how to use the business application tools.  When I'm not doing that, I'm teaching that same application tool at a private university.

Now, would I ever to back into the public/private secondary schools?  The answer is that, "it depends."  In the next couple of years, I intend on starting a family, and currently live in a more expensive area of the country.  With the hypothetical transition from business to full-time teaching, that would result in a significant pay-cut, and a dramatic shift in the work-life balance outside of school.  In rough economic times, I want to keep a job that provides financial security, that does not consume my time when I get home, and that has a desired career path.  My current position has all of those things, and (given my near-term goals) is greatly preferred over teaching in secondary schools.

vstillwell
vstillwell

@BenDickison @vstillwell Look, you might have that one time at band camp experience to relate to, but the fact is a lot of employers today are looking for a candidate to come in walking on water, and until one does, they keep paying a few bucks a month to careerbuilder.com to keep posting that job ad. Then they fill out employment surveys saying they can't find "qualified" candidates. I know this from experience to. In fact, I've seen them do it. What jobs remain today that haven't been outsourced to India or some other Asian country are very skill specific that can only be learned with a combination of on-the-job training and education. A lot of people have the education, they just don't have the on-the-job training part because businesses outside of retail aren't hiring unless a candidate posses those specific skills. It's like a giant circle jerk, and they're not letting anyone in. 

This is what happens when the skilled part of the economy contracts. It's contracting because it's cheaper to pay a college educated Indian than it is an American. It's cheaper to pay a Chinese welder than it is an American. In fact, they hire multiple untrained Indians to do the job of one American. It's cheaper to pay them and have them work on scripts and have a trained supervisor lord over them than it is to train up a recent American college grad. Sorry, I don't mean to be rude, but this is the new economy, and, frankly--it sucks. 

littleredtop
littleredtop

@SteveGaines @littleredtop  Consider that this has been going on since the early 1950's and many of those foreigners have died or returned to their homeland.  I stand by my estimate of more than one hundred million. 

Stichmo
Stichmo

@littleredtop @SteveGaines - Last year's record number of foreign college students totaled 764,000. (http://www.usatoday.com/story/news/nation/2012/11/12/record-number-of-international-students-enrolled-in-colleges/1698531/)   The early 1950's were 60 years ago.  Let's assume a ridiculously high average number of foreign students since the 1950's of 750,000 per year.  60 years times 750,000 per year equals 45 million.

This calculation ignores the fact that many attended for more than one year and therefore contains double (triple, quadruple, ?) counting.  I also  ignores the fact that the numbers have increased significantly recently and the average over these 60 years is probably much less than the 750,000 I used.

Given the above factors, the real number since the 1950's is probably below 10 million.