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Underemployment in the Early Careers of College Graduates following the Great Recession

In: Education, Skills, and Technical Change: Implications for Future US GDP Growth

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  • Jaison R. Abel
  • Richard Deitz

Abstract

Though labor market conditions steadily improved following the Great Recession, underemployment among recent college graduates continued to climb, reaching highs not seen since the early 1990s. In this paper, we take a closer look at the jobs held by underemployed college graduates in the early stages of their careers during the first few years after the Great Recession. Contrary to popular perception, we show that relatively few recent graduates were working in low-skilled service jobs, and that many of the underemployed worked in fairly well paid non-college jobs requiring some degree of knowledge and skill. We also find that the likelihood of being underemployed was lower for those with more quantitatively oriented and occupation-specific majors than it was for those with degrees in general fields. Moreover, our analysis suggests that underemployment is a temporary phase for many recent college graduates as they transition to better jobs after spending some time in the labor market, particularly those who start their careers in low-skilled service jobs.
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  • Jaison R. Abel & Richard Deitz, 2017. "Underemployment in the Early Careers of College Graduates following the Great Recession," NBER Chapters, in: Education, Skills, and Technical Change: Implications for Future US GDP Growth, pages 149-181, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberch:13697
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    Cited by:

    1. Michael R. Ransom & Aaron Phipps, 2017. "The Changing Occupational Distribution by College Major," Research in Labor Economics, in: Solomon W. Polachek & Konstantinos Pouliakas & Giovanni Russo & Konstantinos Tatsiramos (ed.), Skill Mismatch in Labor Markets, volume 45, pages 129-171, Emerald Publishing Ltd.
    2. Shimeng Liu & Weizeng Sun & John V. Winters, 2019. "Up In Stem, Down In Business: Changing College Major Decisions With The Great Recession," Contemporary Economic Policy, Western Economic Association International, vol. 37(3), pages 476-491, July.
    3. Ammar Farooq, 2016. "The U-shape of Over-education? Human Capital Dynamics & Occupational Mobility over the Lifecycle," 2016 Papers pfa484, Job Market Papers.
    4. Yu (Sonja) Chen & Matthew Doyle & Francisco M. Gonzalez, "undated". "Mismatch as choice," Working Papers 2017-04, Department of Economics, University of Calgary, revised 15 May 2017.
      • Francisco M. Gonzalez & Yu Chen & Matthew Doyle, 2017. "Mismatch As Choice," Working Papers 1702, University of Waterloo, Department of Economics, revised May 2017.
    5. Cynthia L. Doniger, 2019. "Do Greasy Wheels Curb Inequality?," Finance and Economics Discussion Series 2019-021, Board of Governors of the Federal Reserve System (U.S.).
    6. Leland Crane & Henry Hyatt & Seth Murray, 2018. "Cyclical Labor Market Sorting," 2018 Meeting Papers 939, Society for Economic Dynamics.
    7. Serge Atherwood & Corey S Sparks, 2019. "Early-career trajectories of young workers in the U.S. in the context of the 2008–09 recession: The effect of labor market entry timing," PLOS ONE, Public Library of Science, vol. 14(3), pages 1-30, March.
    8. Moulton Jeremy Grant, 2017. "The Great Depression of Income: Historical Estimates of the Longer-Run Impact of Entering the Labor Market during a Recession," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 17(4), pages 1-20, October.

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    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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