44% of College Grads Are Underemployed: Here’s How You Can Beat The Odds

college grads

At 4.7 percent, unemployment is the lowest it’s been in years.

But for recent college graduates, the labor market remains harsh. Recent data from the Federal Reserve Bank of New York shows that the underemployment rate for recent college grads was 43.5 percent at the end of 2016.

The underemployed are those who are highly skilled (likely those with college degrees), but working low-skill, low-paying jobs. Unemployment, on the other hand, refers to those who don’t have jobs at all.

And while unemployment has gone down since the last recession, college grads aren’t getting any more jobs than they were 20 years ago. What’s worse, their annual wages looked almost identical to those in 1990 — meaning college grads are severely underemployed.

underemployment rate

Image credit: Federal Reserve Bank of New York

How college grads can avoid being underemployed

Economists have various views about what the government can do to help. But outside of major structural changes, there are steps you can take to boost your “hireability” after college.

Here are three tips on how you can find a job — or a better job — as a new college grad.

1. Make the most of your college career center

According to McGraw-Hill’s Workforce Readiness Survey, just 40 percent of graduates felt their education was very helpful in preparing them for a career. However, most colleges have career centers that will help both current students and recent grads. Even if you’re unclear on your goals, visiting the career center will teach you about your options. Plus, most centers offer services such as interview preparation and resume reviews.

You can’t necessarily control the fact that 8.6 percent of young workers and 3.9 percent of recent college grads were unemployed at the end of 2016. But you can educate yourself about where and how to get a job after graduation. By preparing for the job search before (or soon after) you graduate, you’ll be ready to hit the ground running.

underemployed

Image credit: Federal Reserve Bank of New York

2. Track and highlight your college achievements

You may encounter a frustrating catch-22 during the post-college job search: You want workplace experience, but many jobs are only hiring people who already have workplace experience. Not everyone can afford to work an unpaid internship to ramp up their resume.

If you’re applying with little-to-no experience, make sure to highlight your college achievements. Consider any activities where you held a leadership role or projects that show off your transferable skills.

Perhaps you overcame a significant challenge or collaborated with a team to create something new. Whatever they are, your college achievements can indicate you have the core competencies to succeed in a job.

So don’t discount your college experiences. Instead, look at them through the eyes of a hiring manager. Pick out the ones that demonstrate professional skills, especially if you don’t have much workplace experience. Put them on your resume and LinkedIn profile, and practice what you’ll say during a job interview.

3. Build up your social and professional network

Many job-seekers have lost faith in traditional job search engines such as Monster and Career Builder. These enormous databases invite applications on a national level. All too often, you’ll apply for a position and never hear back.

As it turns out, networking is a far more useful tool in the job search process. According to LinkedIn, 85 percent of all jobs are filled by networking. Often, companies don’t even post jobs online, preferring to fill them internally or via referral.

If you haven’t graduated yet, keep connecting with people who share your interests and goals. And if you can, take advantage of your alumni network. You may even find a mentor or professional you can shadow for a day. You’ll learn about career development while making a valuable connection that could land you your next job.

Stay positive about the job search after graduation

Unfortunately, job prospects have not improved much for young workers in the past 27 years. And while 47.8 percent of recent grads landed $45,000 or higher salaries in 1990, today only 34.9 percent do.

It’s easy to get down on yourself if you’re struggling to find a job after graduation. But at the very least, this data from the Federal Reserve Bank of New York should reassure you you’re alone. And by taking these proactive steps, you’ll get so much closer to finding the right job after college.

Too many college grads are stuck in jobs that don’t require a college degree. As St. Louis Fed President James Bullard said in a recent interview: “[This underemployment] is a waste of resources … If you put all of those people in the exact right jobs, you would get higher productivity.”

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