Average earnings of young college graduates are still falling

Alas, take a look:


Diana G. Carew, who works with Michael Mandel, reports:

The latest Census figures show real earnings for young college grads fell again in 2011. This makes the sixth straight year of declining real earnings for young college grads, defined as full-time workers aged 25-34 with a bachelor’s only. All told, real average earnings for young grads have fallen by over 15% since 2000, or by about $10,000 in constant 2011 dollars.

That picture is the single biggest reason why higher education in this country is in economic trouble as a sector.  And yes, I do understand that the “education premium” is robust, but that means wages for non-college workers have been hurting as well.  At some margin, when it comes to determining how much you will pay for college, the absolute return matters too.  The full article is here.


I'm sitting here thinking of my reduced consumption, since 2007, and the sort of things I might be buying from those kids without a housing crash and a bear market. If I am at all typical, its aggregate demand.

I concur, it's AD not AS.

In 2007, were you sitting here thinking of your increased consumption since 1999, your maxxed out credit cards, and the home equity loan you just took out on the inflated value of your house, and wondering how your current level of consumption could be maintained? Because this would not be atypical.

When i hear insufficient AD, I think 2007 redux.

I personally was debt free, and enjoying "wealth effects" without too much guilt. Older people with paid-for houses were not unheard of.

So...maybe you suffered a paper loss on a house you had bought years before, or you're not a home owner. either way, shrug-offable.

And impressions to the contrary, the S&P 500 has gained 11% since the end of 2007, a smidge ahead of inflation.

So why exactly aren't you out there doing the drunken sailor like a good American?

I'm ok too, but currently hobbled by $250K I'm holding back to pay my family's share of the federal debt.

But we're largely not talking about you and me anyway.

Have you literally set aside $250k that you've earmarked as your share of the debt? As in, do you actually have that money in a bank account or this an estimation of how much you've decreased current consumption in expectation of increased future taxes?

If it's really sitting in a bank account, how exactly do you envisage the collection scenario playing out?

Fortunately, for me, it's in the bank but, funded or not, no personal balance sheet is complete, IMO, without reckoning with this as a liability in some fashion. If you're young, it ain't your liability. If you don't make much, your liability isn't much.

The $16 trillion isn't for anything the government might do tomorrow- this is for services rendered. Simple accounting.

If you're a Baby Boomer and you ignore this, you are ripping off your fellow citizens.

Either the debt is paid down, or, when I die, I turn the reserve over to my children to help with all the debt they'll be inheriting.

I still don't understand exactly the scenario for which you're preparing. No one is going to show up at your door one day asking you to hand over a check. The likely outcome is that taxes will go up on everyone. When that happens, your $250k just becomes a huge tax liability. If anything, that makes me want to consume more now.

My phone comments seem to be sticking, trying again from a real computer .... I think you jumped from my economic observations to some assumed economic policy. My observation was that I'd pulled back. Or in other words, the hit to animal spirits was much more broad than to deleveragers alone. People with good home equity and a bond-heavy portfolio took a loss in growth across the board.

And so yeah, people like me are part of the problem for would-be sellers of goods and services.

I understand that equities are up, and I hold some, but I haven't yet made the bet to go equity heavy in retirement.

Re. the "baby boomers" comment, lol, if people like me who made money, banked it, and retired are enemies of capitalism, who the heck are the heroes?

john, the past five years have been amazing for bonds: up 40%+. This is what happens in a declining interest rate environment. As for the next 20 years, hell, this isn't even an economic forecast, just simple math: bonds should come with a warning label right now, as Buffett says.

I'm still trying to understand though, why you've curtailed spending despite not being plagued with the problems that plague so many. Because I believe, empirically, that people are reluctant to spend now, even those with means, and I think it's worth understanding that thought process. I've already given you mine- there's this huge liability out there that most people choose to ignore, if you listen to Keynesians. And its growing at a healthy clip. And we haven't hit the demographic cash flow crunch of Baby Boomer retirement yet.

I think investment prospects across the board are much more subdued than in the past, particularly if you don't want to take risk or can't afford to. Maybe this is part of the explanation. But to me, this leads right back to government policy (the Fed in this case), just like the debt.

j r, you are not going to persuade me that $1 in government debt is magically different from some other kind of debt. I have put forth a simple 'rational expectations' view of government spending.

Keynesians tell us most people don't think this way, opening the door for all manner of shell game fairy tales for improving the macroeconomy.

Maybe they don't. But you're going farther. You're telling me that it's not rational for me to think this way. This, I cannot abide.

And perhaps this strand of thinking is part of the explanation for why the john persona's of the world aren't patriotically blowing up their own balance sheets. In any event, if you say insufficient AD, you must be thinking of the john persona's and Brian Donohue's of this world, not some guy with no net worth to begin with. So what's your explanation?

40% is a funny claim. The total bond market (using Vanguard's fund as a proxy) has rolled over from ~5% annual returns to ~3% (Morningstar). With a zero interest rate policy and continuing cycling in bond portfolios, that has to keep falling. The "hope" for high interest rates seems to be fading.

When you say "I think investment prospects across the board are much more subdued than in the past" you get it, that depresses the animal spirits, the consumption, the demand.

john, I'm not saying you're an enemy of capitalism, just that your bank account reflects the fact that, over the past 11 years, you (and me and everyone else) haven't paid close to what the cost of the government we received has been. This has nothing to do with the future of entitlements or taxes, which is a formidable enough challenge even without a $16 trillion millstone.

I feel guilty about the $16 trillion, and what we're doing to the next generation (I'm slightly post-Boomer). Do you feel any responsibility for this at all?

re. your comment to jr, the differences between me and a nation are that I can't define the currency, I have a finite working life, I must retire my debt before I retire myself. A long-lived state with the power to tax and (slowly) inflate forever has much stronger borrowing position. With good reason.

Since I distrusted the Bush tax cuts from the start (and made my money under the previous regime), I don't feel terribly responsible for the post 2000 debt bubble.

So, you'd pulled back. Had you previously pushed forward?

The Keynesian AD assumption seems to be that pushing forward isn't possible. And yet we also ran deficits the entire time.

"You’re telling me that it’s not rational for me to think this way. This, I cannot abide."

No. I'm not.

I'm saying that the expectation of a future tax liability has two offsetting characteristics. There is an income effect that says future taxation will make me poorer in the future; therefore I should save more now to make up for it. There is also a substitution effect, however, that says future taxation will make future consumption more expensive, so I should substitute future consumption with less expensive present consumption.

It seems like you've chosen to let the income effect dominate your decision making, which is perfectly rational. It's just not clear why anyone else should automatically share your consumption preferences.

Yes, I pushed forward. I worked for a company serving auto dealers, postponing retirement and spending paychecks of fun things. The company downsized with auto dealers in 2008. I survived that but burned out later. Pulled in my horns, took a simpler life. In a go-go economy that might have broken quite differently.

john, 40% is not a claim, but it is based on Treasuries, which have fallen more than corporates. The Barclay's ag is up 33% over the past five years. No one who has been paying attention would dispute a bull market in bonds over the past five years (30 even.)

When I say "I think investment prospects across the board are much more subdued than in the past" I am not invoking some mystical Keynesian claim. Simple supply and demand. Lots of old people with capital searching for return, low-risk preferred. Real rates will be low for a long time.

And to the extent these old folks are the same people who are leaving us holding this staggering debt bag, maybe an accommodating Fed turning the screws here represents a kind of rough justice. One way or another, I want you Boomers to cough up before you croak.

I'm picking up that "animal spirits" must be doubted, not because they can't be directly observed, but because recognizing them just might lead to Keynesian thinking. Surely we have to accept the reality, and then choose whatever (Keynesian or not) framework to deal with it.

john, Willem of Occam and I hold that explanations like "animal spirits" shouldn't be invoked when simpler explanations, like supply and demand, suffice.

j r says: "There is an income effect that says future taxation will make me poorer in the future"

Incorrect. You are poorer today. The liability exists today. The money has already been spent.

I think imagining supply and demand without spirits fails Occam, pretty clearly. You must deny observed behavior.

"I’m picking up that “animal spirits” must be doubted, "

Not from me. From me it is that the government didn't counter-balance the positive animal spirits of the 90s and early-to-mid 00s.

"Incorrect. You are poorer today. The liability exists today. The money has already been spent."

What are you basing that on other than your own ideological insistence?

There's only two ways that increased government spending can effect the individual's cash in hand. The government can raise taxes or it can monetize the debt. Until those things happen, you're only poorer in your own mind.

"There’s only two ways that increased government spending can effect the individual’s cash in hand."

Huh? They can't buy scarce goods?

"Huh? They can’t buy scarce goods?"

Please, take this in context of the ongoing conversation. I am speaking of ways that increases in overall government spending effect the individual's balance sheet. Brian is saying that whenever the government issues debt, it creates a corresponding liability to every single citizen. I don't buy that and I'm saying that all it creates is the expectation of a future liability.

Of course, I realize that are an infinite number of ways that the government can specifically make you poorer. It can send a drone to blow up your house , for instance. That's not what we're talking about here.

j r says: "Brian is saying that whenever the government issues debt, it creates a corresponding liability to every single citizen. I don’t buy that"

I think that sums it up nicely. Only I don't think it's an ideological argument- more of a dispute around whether or not accrual accounting makes sense. I think it does.

Gentle reader, decide for yourself.

"I think that sums it up nicely. Only I don’t think it’s an ideological argument- more of a dispute around whether or not accrual accounting makes sense. I think it does."

I accept the accrual accounting part. I just don't understand why you equate the central government's balance sheet with the individual's balance sheet. Government debt and private debt are two different things, sure one effects the other, but they are just not the same thing. Again, the only way that public debt gets transferred to the individual is through taxes or inflation.

By the way, I'm not just keeping this conversation going because I like to argue. This is an ongoing concern of mine. Our fiscal situation dictates that by the time I'm ready to retire, public benefits will be greatly decreased and taxes will likely be much much higher. And like I said, there's an income effect and a substitution effect. I want to maximize my savings to make up for future expectations, but I'm also worried that if I manage to save to the level that I would like to, I'm just going to get half of it taxed away.

I personally, was whiling away the time in graduate school, waiting for a green card.
I particularly enjoyed the classes on Greek Mythology and Roman History.
Course, I wasn't producing much or earning muc either. But that's because the law forbade me from doing so.

Other than the weird gyration in 2004 and 2005, the trend has been downward since the beginning of the graph, so it extends beyond the more recent economic difficulties.

Well, the graph captures both the dot-com crash and the housing crash. Not a good span for wealth effects either way.

Practically all of the change is from 2005 to 2007. That's hardly compatible with an AD housing crash explanation.

You should say "degree premium" because you don't actually observe "education."

+1. Also, there is the oft-noted problem of selection bias in those with college degrees.

I'm a skeptic of some degrees, but I don't think they've gone materially south, or the mix has become materially less commercial, since 2005.

You mean 2000 and beyond, with a slight blip in 2005 probably from the bubble. And that's not the point anyway. In fact, I would suspect that in a retrenching economy you can have absolute declines with an increasing premium.

So, were the 1990s not high growth after all? It strikes me that a number of things in this thread that are suggested as growth stoppers were true, or more true then. We had debt. We had high tax. Of course we were retiring debt with that high tax, and reaping high growth. What a deal, eh?

Might be nice to super impose the amount of debt payment on this

Again, M. Cowen, what interests me most in this case is how you reconcile this reality with your liking of Pr. Raghu Rajan's theory that 'if only young people were well educated...'

I know I've been doing a bit of self-promotion here but here is just one more: http://theredbanker.blogspot.com/2012/11/the-true-lessons-of-recession-really.html

Relevant extract: "[Pr. Rajan's] solution to the polarisation described is that the US workforce should be better qualified so that they can "bifurcate up", as it were. Well, Europe, Northern Europe and France especially, have maintained a high quality public education system, from early schooling to university-level education. The educational attainment is a lot higher in France than in the US. In the USA, a bit less than 30% of the 25-29 years old have a bachelor degree or more. In France, according to the Ministry of the Education statistics, it's above 40%. This better educated workforce has done nothing to help France's unemployment issue. All we got is a better class of unemployed and under-employed people. As the saying went in the 90s crisis in France, "wanna hire a PhD? Check out the pizza delivery boy"...

Tyler is loath to recognize that higher education, the modern day version of the Chinese imperial examinations, is becoming a barrier to economic growth and innovation.

Are "earnings" wages or total compensation?

Wage. Census is not pricing how much respondents' benefits packages are worth.

That makes the graph somewhat close to worthless, then.

You can't always get what you want
You can't always get what you want
You can't always get what you want
But if you try sometimes well you might find
You get what you need

I agree that the situation isn't great but was wondering if starting in 2000 might be exaggerating the decline somewhat as the .com bubble peaked that year. Until the VC/IPOD money dried up, graduates with even very limited domain skills could easily find what had been considered mid-to-senior pay until a few years before.

Evidently people have not read the citation. After explaining the causes, which are themselves interesting and not so far discussed in the comments above, the article concludes:

"Given the prospect of falling real wages, coupled with rising college costs and debt, many young people are beginning to question the value of a college degree altogether. That means it’s essential whoever wins the election make the plight of young college grads a priority. Not making the investment in education is not the answer; ensuring there are better jobs upon graduation is."

I would be interested in some cross country comparative data.

For example, what are the income trends for college graduates in Sweden, Germany, England, Brazil, Japan, Spain...etc., and how do they correlate with changes in GDP or how are the composition of graduate degrees (science, non-science) different between these countries. How does the existence of state subsidized education, in some cases free education, change anything.

So far, I haven't seen any cross country comparisons of earnings changes for recent college graduates, nor an analysis using any of the factors above. My concern is that if we do not disaggregate some of the data we may be misleading ourselves if we push people, say, into engineering. We live in a tradeable world, and if everyone becomes an engineer, and the engineering jobs are in China.....

For the need of my blogpost above, I checked some international educational attainment numbers. It's not all that easy but, as mentioned, France, with its nearly free higher education system, is above the USA.

I would suspect it's the case everywhere. When higher education costs little (well, opportunity costs only), people pursue it.

Especially as there is an eduction premium in the sense that it guarantees you'll be the last man standing when jobs are disappearing i.e. your education premium is having the privilege to work while your less educated counterparts rot on the dole...

Wrt sciences stuff, some specific sciences sectors might do better (IT, life sciences) than others (engineering geared towards manufacturing?). France had plenty of unemployed engineers and/or engineers were grabbing non-engineering jobs (lots and lots of them in banking, for example. And not just in finance but also in stuff like retail etc).

Trust me, I am European. Education is NOT the solution to unemployment.

Trust me, I live in Germany. Education is the BEST way to ensure a successful manufacturing economy over generations - even when the physical infrastructure is completely destroyed, a highly educated work force is able to rebuild it. And this is not merely demonstrated by German experience alone - Japan showed the same ability.

However, if one wants to argue that college is not the best way to educate a work force, well, there is no doubt that Germans would agree with that observation.

Because in Germany, this statement makes no sense at all - '...higher education in this country [U.S.] is in economic trouble as a sector.' Nobody considers higher education an economic sector here, at least in my experience (why yes, I do spend time socially with several professors/researchers at KIT).

The German idea is to actually make things with a highly educated work force, a work force that spends much more time learning skills, and then working productively. And then using tools like Kurzarbeit to keep that work force in place, so it is easy to make a boatload of money in a market where the competition has been too short sighted to realize that even a quarter of a century is not really that long term in regards to planning.

Maybe one day all the kind words will enable Germany to make up the 25% gap in per-capita GDP between it and the U.S.

Da. We educate many engineers- watch economy hum.

I worked with some telecommuting Russians. They're probably too young to have spent much time under communism, but they graduated from universities largely the same. They were all very good. And yes, their telecommuting was part of the reason I was the only US engineer on US soil, out of a team of 8 or so designing for US small business.


I do not consider Colbertist/export-led countries to be 'successful'. Germany's trade imbalances are killing the rest of Europe, thank you. Same as China is half the problem wrt USA/rest of the world.

A good trade balance is one hoovering around 0... There are no ways all countries can adopt a German model. Who would buy all that stuff? Martians?

What I want to see is the ratio of the mean income of people age 24-35 with a bachelors degree and without.

I would guess that it would tell a different story.

The data for you to generate that is publicly available at ipums.org. It's pretty easy to work with, too.

It's from those deep pockets that we're going to make health care "Affordable."

That picture is the single biggest reason why higher education in this country is in economic trouble as a sector.  And yes, I do understand that the “education premium” is robust, but that means wages for non-college workers have been hurting as well.

Education is not in any "trouble" at all until right up until the moment it collapses.in this sense inflation in college degrees recapitulates inflation in the currency and the bond market. The "education premium" is " robust" in the same way that the dollar itself is robust: it's the only thing your grocer will accept, up until the very day he doesn't.

Interesting comments above; they do a great job showcasing the Keynesian mental virus and the terrible hold it has on its victims. Bill throws in some Knowledge is Power Children are the Future cheer leading for higher ed and concludes that someone ought to "ensure" high-paying jobs. Anyone else nervous about that?

ladderff, I suppose you are in the "let's do all we can" not to do anything group. No one ensures anything, but if you are not educated for the jobs that are or might develop, you will never be there.

Perhaps you should suggest to YOUR children that they not go to college. Or, do you take a different position with respect to your children, and why?

I never told anyone not to go to college. After all, the taxpayer subsidizes it; the government rewards it in a dozen different ways, such as offering makework nonsense jobs (which is what "ensuring there are better jobs upon graduation" really means), and making it a requirement for various other jobs that it shouldn't be a requirement for; the professional guilds make it a requirement for even trying to gain entry; and there's free beer and pizza somewhere on campus every day of the week—not to mention co-educational, um, companionship. Tell my kids not to go to college? No way!

Two quotes from a paper that MR linked to in 2010:

A “year” of college, then, would seem a nominal measure of time. It is a currency whose face value has eroded more or less continuously for over 40 years.

Postsecondary institutions appear to have fallen short of their own standards, and to have done so by ever increasing margins.

Now, we could lament these facts, or we could acknowledge their cause.

Is there any study that considers the composition of degrees awarded over the period?

1. What does a person with a Degree in X make now vs. a person who graduated with a Degree in X in 2000?
2. What share of the total number of agrees awarded are Degrees in X?
3. What share of the degrees awarded are from schools that abandoned any pretense of having standards?

My suspicion is that while the general fall is partly the result of general economic conditions, a significant chunk of the aggregate fall could be shown to be the result of an increase in the number of low value degrees awarded.

If you threw out the "Bachelors Degrees" in sham subjects from sham schools, the premium for a real degree from a real school would still be fairly robust.

A greater percentage of women have been receiving college degrees. Maybe that explains this graph.

If those same women tend to work less hours over the same time frame than their male cohorts a rise in the ratio of women to men college graduates would indeed cause downward pressure on the average wage.

Women simply choosing less lucrative careers than men would explain it.

LEARN COMPUTER PROGRAMMING. Here in the Bay, companies are beating down our doors for hires. $75k starting, $100k for kids with a few years of experience or a specialty. Yeah, you have to work hard, but not hard like ibank drones or Deloitte/McKinsey powerpoint technicians (as people like to call themselves when their job is horrible). And you make the world a better place.

Seriously, you don't even have to take classes. Just learn online and start putting projects on github.

So you're saying there are all these $100k dollar bills just lying around the Bay area...

Why aren't people picking them up?

limited supply on the autistic side of the curve.


well played sir

EMH. If they were real, someone would have picked them up by know.

Were you around a few years ago when Tyler posted the ratio of STEM to non-STEM majors, comparing 1980s to today? Apparently, either the supply side of the labor market isn't rational, or there's something preventing the marginal student from learning programming.

As the number of people who receive degrees expand, wouldn't you expect the marginal person to have lower earnings than the average (leading to a decline in the average)? This seems particularly true as adult learners populate online universities to complete BA's. The population cohort is not constant across this time horizon.

Over the 20th century, college enrollment expanded massively. So in 1900, was the college wage premium worth millions of dollars?

"So in 1900, was the college wage premium worth millions of dollars?"

It was almost certainly higher than it is today.

Yep. About 3% of the population, including all of the doctors, lawyers, etc., were college educated, and the average worker made about $100 a week in today's dollars. (Per capita GDP in Geary-Khamis international dollars was around $4000). Considering today's pitifully deflated dollar, where a million of them isn't really enough for an adequate retirement, I am almost certain that the college premium was worth millions.

OMG!!! Run for the hills!!! It should be said loudly, ALL US WAGES ARE FALLING!!! So we all trot out the charts of the college premium and the charts should have a benefits estimation (1/3 of salary). Throw in the fact the unemployment rate is lower and a lot of service & retail jobs have diminishing hours. The wages in the US are lower because we are competing globally and the US wage premiums are diminishing. My simple advice for young high school students not with straight As is to focus the next 7 years on developing a "traditional blue collar" skill and still get a college degree. Do not start a family until you are at least 25 and somewhat settled.

I do agree this is a structural wage recession but it is not caused by traditional sector failures. It is caused by the diminishing wage premium.

No duh real earnings are falling. How else do you explain the 3-4% College-grad unemployment rate. This isn't demonstrating structural changes. It's showing what happens in a recession when jobs wash up and college grads don't get fired.

I am not convinced this chart is meaningful without a look at majors mix. It could simply be that more & more student are graduating in Visual Arts and fewer & fewer in CompSci (or other STEM) - see Tabarrok.

Most people have touched on this but I'd like to see how the population is changing over time.

1. How many higher paid people are becoming excluded from this population because they are have attained higher degrees and are no longer 'only a bachelors'. I think there has been an increase in Master's degrees over the past 10 years.

2. How many people are getting higher degrees and still considered 'employed full time'? If we have more people doing master's programs AND working full time, chances are they are making less because they have less time to devote to work.

3. Graduating in a recession leads to lifetime pay gaps (http://www.ingentaconnect.com/content/aea/aejae/2012/00000004/00000001/art00001). More specifically, the extreme values of the the high end (mostly caused by IBanking) tend to distort average wages. With the ibanking industry shrinking in terms of new hires for a few years this could seriously distort a mean wage calculation, especially since these are the extreme high values of the 'only a bachelor's' degree population.

3. As others have said - more lower paid people are becoming included because of the expansion of Bachelor's programs.

Some things i'd like to see to fix this:
A) To make these types of comparisons I'd think you'd a cohort analysis would be helpful. What are the class of 2000 graduates doing compared to the class of 2008, etc.

B) Median or IQR metrics rather than mean. I think we would still see a decreasing trend looking at the IQR over time but I think it would be much less pronounced.

C) To adjust for the fact that much of the last few years have been a recession which distorts the fact that this may just be economic noise I'd like to see this value not just adjusted to real terms but also relative to 'full time working population with high school only'. This would be a positive trend as people have stated because of the growing degree premium.

You can generate all of this except for "What are the class of 2000 graduates doing compared to the class of 2008" via the data that is publicly available at ipums.org. (You can't do that part because the data doesn't have when people got their degrees - people usually proxy for that by just using age-22, but that's not great.) I think you will find that very little of what you see on this graph is due to overall upward shifts in educational attainment. But the only way to tell is to test this.

On the other hand, being on the lower end of the pay scale likely increases your job security. When it comes time for layoffs, they fire the overpaid people first.
Also, starting in the middle of a recession means that as the economy recovers you move up quickly.
Starting at the height of a boom probably means the company quickly downsizes after you are hired, and you end up either getting laid off right away (which looks bad on a resume) or stuck in a lower grade position for a long time (which also looks bad on a resume). You *want* to start right as the economy is coming out of recession, so you have a solid 5-7 years to gain professional experience in a growing company.

Good points. Better to have one job that pays $50K than zero jobs that pay $60K.

Also, what is the unemployment rate for this group? Has it gone down? If so, wouldn't we expect this pattern? Isn't this why the sticky wage crowd likes a bit of inflation?

That might be true but I'm talking about potential distortions of their metric 'Mean Earnings for Young holders of a Bachelors Degree that are working full time'. Going off of your logic, it also makes sense then that if the aggregate level of employment is lower, controlling for population growth, then the positions that remain are the lower paid ones, thus further distorting the 'average' earnings of this group due to the recessionary periods.

Also, without the relevant experience, as you touch on, will result in a lower number of average experience across the population after a recession. Thus, in the sample of 25-34 people in 2000 it could have been composed of people with many more years of experience than in the 2011 sample because that is a population that has dealt with 2 recessions reducing the average number of years experience.

Hours worked is another issue. Were the people in 2000 working more hours than in 2011?

All of these are issues but I feel like a lot of it is matter of fact due to population changes. They are not unique to this population group. Now, if we controlled for most of these variables are still saw a large drop then I'd be interested in that.

Median or IQR Hourly Wages/Average # of Years Experience would be an interesting cut and doable with this data set. I've requested access to this data and if I get access I'll follow up with any findings.

+1 Cool. The world is complex.

There are many reasons why, including automation, offshoring, reduced demand, economic caution, labor changes due to the internet, to name a few, but it is the fact that there is an oversupply and lack of demand for labor of all types.

It would be nice to see some sort of breakdown by field.

How are the wages of engineers doing relative to liberal arts majors?

Like I keep saying, the unemployment level for college grads is low because they out-compete the non college grads for jobs that do not require a college degree. That is all the difference in the unemployment rate between college grads and non college grads means. I do not see how getting more people through college will help.

No job really requires a college degree. The idea that the "personal banker" who follows you around when you walk into the bank with a substantial deposit "needs" his finance degree from Arizona State is laughable. What he needs to be able to do is to calculate compound interest, and understand legal documents that have some hard words in them. My father didn't go to college and he could both of those very well.

Even law schools and medical schools used to accept non-college graduates. Abraham Lincoln, the greatest mind that American public life ever produced, didn't go to college. I could go on and on.

What we've done is outsource the job screening function to an industry that is called "education" but that mostly provides a mix of technical training and finishing school.

Agreed is it is mostly signalling. There are even some engineers without college degrees.

We definitely need some more immigration to fix this problem.

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