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How The Recession Impacted College Graduates

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As far as current events are concerned, 2008 was another busy year.

Fidel Castro retired. The Philadelphia Phillies won the World Series. Michael Phelps nabbed seven Olympic medals in Beijing. President Obama was elected to his first presidential term.

It also marked another year where Americans experienced the worst economic downturn in nearly a century.

And now a  report out this week from the U.S. Department of Education’s National Center for Education Statistics looks at how the recession impacted 2008′s college graduates in the years following their graduations.

Of the roughly 17,000 graduates surveyed who didn’t head back to school to ride out the recession, 83 percent reported landing some type of employment four years after their graduation.

Eighty-five percent of those worked a single full-time job, with the rest working one or more jobs part time.

The unemployment rate clocked in at seven percent among those 2008 grads, roughly three percent higher than the overall unemployment rate for adults between the ages of 25 and 34 with a college degree.

And as Vox reports, that could be a bad sign, since the unemployment rate should be lower than average for college graduates in order for a diploma to be a worthwhile financial venture.

Michael Jones, the Director of Research at the University of Cincinnati’s Economic Center, said he’s neither surprised or overly encouraged by the report’s findings.

While he’s discouraged by the unemployment rate, he said it doesn’t even reflect another group of graduates: those who enrolled in more classes after earning their diploma.

“Quite a few other students ended up going back to school,” he said.  “We don’t know whether those students went back to school because they couldn’t find a job, or they just wanted to pursue higher education.”

Jones also points out additional research already predicts this group may struggle far beyond their graduation day.

“Those who graduate in a recession typically have earnings about nine percent less than they otherwise would have,” he said. “That effect continues to persist of lower earnings all the way up to about ten years later.”

The NCES report highlights even more information about the plight of these recession grads:

  • Graduates majoring in healthcare-related areas faced the lowest  unemployment rate at roughly two percent. Not far behind were those graduates majoring in STEM fields, with a five percent unemployment rate, while social science majors had a nearly 10 percent unemployment rate.
  • By 2012, 54 percent of graduates were unmarried with no kids, 21 percent were married without kids, 20 percent were married with children, and five percent were single with kids.
  • Full time workers had an average annual salary of  $52,200.
  • Over a third of graduates worked one or two jobs during that four-year time frame. Sixteen percent held three gigs, while the remaining grads worked four or more jobs.

 

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