The job outlook for college graduates through the mid-1990's.
Many different forces work together to create the conditions in a job market. Economic growth fuels demand for a larger labor force; workers switch fields or leave the labor force, opening up positions for new jobseekers; the ways tasks are performed change, raising the level of education workers need for some occupations and lowering it for others; and the supply of people seeking jobs varies. All these forces affect the college labor market.
Increases in the demand for college graduates stem in part from growth in occupations that require a college degree--professional and technical, manegerial, and nonretail sales occupations. College graduates are also required each year to replace workers in these occupations who retire or leave the labor force for someone other reason.
Educational upgrading is another major causes of growth in the demand for college graduates. Many occupations now require more complex skills. As a result, employers often seek college graduates for jobs once filled by high school graduates.
Not all educational upgrading reflects changes in skill requirements, however. It also occurs because employers tend to hire the best educated, qualified applicant. In addition, college graduates who fail to find jobs in their chosen field often lower their expectations. Determining whether the increase in the proportion of college graduates in an occupation is due to a real increase in the required skill level or to the abundance of college graduates is difficult.
Additions to the supply of college graduates in the labor force come from the ranks of new graduates and from those of past graduates who enter the labor force from other activities. These past graduates are primarly reentrants--workers who left the labor force to raise a family, pursue graduate edcuation, live abroad, or devote their time to other nonlabor force activities. Smaller numbers of entrants are immigrants or college graduates who delayed entering the civilian force while they followed military carees or concentrated on personal or family affairs. The Job Market in the 1970's: A Growing Surplus
The job market for college graduates deteriorated beginning about 1970 with the rapid growth of the college-age population. People born during the post-World War II baby boom reached their late teens and early twenties and the flow of new college graduates into the labor force became a flood. Over the 5 years from 1969 to 1974, the number of bachelor's degrees awarded annually by the Nation's colleges and universities increased by more than 200,000--from 729,000 to 946,000--and remained at a high level thereafter. Furthermore, large numbers of people who had earned their degrees in the 1960's, and even earlier, returned to the civilian labor force after starting families or serving in the military during the Vietnam War, adding even more potential workers to the pool.
Over the 1970-82 period, the number of college graduates in the labor force doubled to 21 million. An average of about 1,400,000 college graduates annually entered the labor force. Of these, an average of about 900,000 were new graduates. Despite rapid growth in may occupations requiring a college degree and considerable educational upgrading, the number of jobs available failed to keep pace with the number of graduates seeking positions. Job openings averaged about 1,150,000 a year over the period, leaving a deficit of about 250,000. Contributing to the lack of new jobs was the slow growth in elementary and secondary school teaching. When the baby-boom generation began leaving elementary and secondary school, enrollments fell, and employment opportunities in education declined. Between 1970 and 1982, the employment of elementary and secondary school teachers grew only one-tenth as fast as the employment of college graduates in general. Since nearly one-fourth of all college graduates employed in 1970 were school teachers, the impact was significant.
The occupational pattern of college graduate employment changed greatly between 1970 and 1982, as the tabulation below illustrates:
The proportion of college graduates employed in professional and technical jobs dropped dramatically during this period, while it remained unchanged in managerial jobs and increased only slightly in sales jobs. The most striking change, however, was the increase in the proportion of college graduates employed in occupations that have not traditionally required a college education; since 1970, this proportion has nearly doubled.
No firm line can be drawn between jobs that require a college degree and those that do not. Even in many college-level occupations, some jobs do not require a college degree. However, jobs that require a college degree are concentrated in the professional and technical, managerial and administrative, and nonretail sales groups (a small number are in the other groups). In 1982, nearly 70 percent of these jobs were professional and technical, which continued to be the most important source of employment for college graduates. About 20 percent of the jobs were in managerial and administrative occupations, and an additional 7 percent were in nonretail sales occupations. Few. of the jobs in retail sales, clerical, craft, operative, service, laborer, and farm occupations required a college degree in 1982, although more than 20 percent of all college graduates worked in these occupations.
College graduates who told positions that do not require a 4-year degree are often referred to as underemployed. Underemployed college graduates totaled more than 4 million in 1982--the acumulation of more than a decade of college graduates who were unable or chose not to enter a job that required their level of education. For example, more than 20 percent of the college graduates in the labor force held clerical, retail sales, or service jobs in 1982, as noted above; but fewer than 1 out of 7 of these graduates had a job that required a college education. Of course, many of these workers have satisfying careers as carpenters, flight attendants, and retail sales workers or in other occupations that do not require a college education. Others, however, view their present jobs as temporary; they can be expected to compete in the future for jobs that use their education more fully. Outlook Through the Mid-1990's
Projected supply. Nearly 21 million college graduates are projected to enter the labor force between 1982 and 1995, an average of about 1,600,000 a year. (See chart 1.) They will come from two groups: New graduates and graduates who are not currently in the labor force.
The size of the Nation's college-age population--people between the ages of 18 and 24--will decrease over the 1982-95 period. The drop is expected to be about 22 percent, from 30.4 to 23.7 million, reflecting the decline in births over the past two decades. As a result, the number of bachelor's degrees awarded annually over the 1982-95 period is also expected to drop. (See chart 2.) Thus, a declining number of new college graduates will be seeking jobs. About 870,000 people a year, on average, are expected to enter the job market shortly after their college graduation. This represents an average of 36,000 fewer new graduates annually than there were in 1982. However, this drop will be more than offset by growth in the number of other entrants.
About half of the college graduates entering the labor force will be people who now have degrees, in contrast to the 1970-82 period when only about one-third of the entrants came from this group. The increasing number of reentrants and other entrants to the labor force reflects the increasing number of people moving into and out of the labor force.
Projected demand. The Bureau of Labor Statistics develop a new set of economic projections every 2 years encompassing the labor force, gross national produce, industry output and employment, and occupational employment. The most recent projections cover the 1982-95 period and view the economy under low-, moderate-, and high-growth scenarios. The outlook for college graduates is roughly the same in all three scenarios; the analysis in this article centers on the moderate-growth projection.
The demand for college graduates over the 1982-95 period was projected by analyzing trends in both occupational employment growth and educational upgrading within occupations. Based on trends in the proportion of workers with 4 or more years of college education in the various occupations, ratios were projected reflecting the proportion of jobs in each group that could be expected to require a college degree. Projected requirements for college graduates were obtained by applying these ratios to the projections of total employment in each occupation.
Openings for college graduates are expected to total nearly 17 million over the 1982-95 period, or about 1,300,000 each year, on average. About 750,000 of these openings will occur as employed college graduates leave the labor force to retire, return to school full time, devote greater time to their families, or for other reasons. About 550,000 job openings a year are expected to come from growth in the number of jobs that will require a college degree. The number of jobs that require 4 or more years of college education is projected to grow by 45 percent over the 1982-95 period, compared to the 25-percent growth projected for all jobs.
The demand for college graduates in professional and technical occupations is projected to increase by 37 percent over the 1982-95 period. Jobs for elementary and secondary school teachers, who accounted for nearly a quarter of all college graduates in professional and technical occupations in 32 percent over the period. Professional and technical occupations for which at least a 50-percent increase in jobs requiring a college degree is projected include engineers, dietitians and therapists, registered nurses, computer specialists, and buyers. For life and physical scientists, social scientists, lawyers, and social workers, jobs that require college are projected to grow 30 percent or less, primarily because their present high level of education leaves little room for educational upgrading and secondarily because of generally slower growth.
Jobs requiring college graduates are projected to continue to grow much faster than average in managerial and administrative occupations--increasing nearly 70 percent between 1982 and 1995. Educational upgrading of many salaried jobs in these occupations is expected to be a major source of growth. Jobs for college graduates in nonretail sales occupations are projected to grow more than 50 percent over the 1982-95 period due to educational upgrading. Occupations in this group that require substantial numbers of college graduates include insurance agents and brokers, each estate agents and brokers, and stock and bond sales agents.
Very few jobs in retail sales, clerical, craft, operative, service, laborer, and farm occupations will require a college degree. However, they will continue to be a source of employment for college graduates who do not find or choose not to enter jobs requiring a degree. Imbalances Will Continue
More openings for college graduates are projected annually over the 1982-95 period than in the past as the economy grows and the number of college graduates leaving the labor force increases. However, the number of college graduates entering the labor force is expected to increase as well--preventing any shrinkage in the size of the current surplus. The job market will be more competitive to the extent that currently underemployed graduates will vie with future entrants for college-level jobs.
The majority of graduates are expected to enter jobs that require a college degree. (See chart 3.) However, a surplus of about 4 million college graduates--300,000 annually, on average--is expected to enter the labor force over the 1982-95 period. Although a few of these graduates will experience prolonged unemployment, most will enter clerical, retail sales, blue-collar, or service occupations that do not require a degree for entry. This outlook represents little change from the job market faced by graduates during the 1970's an early 1980's, when a similar proportion--about 1 in 5--took jobs that did not require their level of education or became unemployed. Implications
The prospect of a continued surplus of college graduates is not likely to dissuade many people from pursuing a college degree. The educational attainment of each generation of Americans has surpassed that of the previous one. Few would argue that the trend will change because many parents still dream of sending their daughters and sons to college, and the noneconomic advantages of a college education remain undisputed--opportunities for learning, personal development, and broadening interests. Furthermore, college graduates, on average, do fare better than nongraduates in the job market, since their additional education is often an advantage in competing with nongraduates. Graduates may also have an advantage in gaining promotions in noncollege jobs, and the experience they gain in such jobs may prove useful when they later compete for more challenging jobs. In addition, college graduates can expect greater lifetime earnings, on average, than people with less education. And finally, although the unemployment rate for college graduates has increased since the 1970's, it is still much lower than the rate for all workers. In 1982, the unemployment rate was 3.0 percent for college graduates; 6.2 percent for workers with 1 to 3 years of college; and 8.5 percent of workers who had only completed high school.
as in the past, most future graduates will find jobs that are challenging and satisfying. Nevertheless, a college degree is not the reliable ticket to a good job that it once was. Future college graduates cannot be assured that they will find jobs in the occupations of their choice. Some will experience brief periods of unemployment, have to relocate to other areas of the country, scramble for the best available jobs, or job-hop before finding one that satisfies them.
Knowing which occupations are likely to offer the best employment prospects can be an invaluable said in career decisionmaking. The following article on jobs entered by graduates of the class of 1980 indicates that, despite overall surpluses, not all graduates faced keen competition for jobs. For example, more than 9 out of 10 of those who majored in accounting, chemistry, computer science, engineering, mathematics, and nursing who were in the labor force entered college-level jobs. The effects of the surplus were felt much more by graduates in agriculture and natural resources, art, communications, English, and the social sciences. Fewer than 3 out of 4 of the employed graduates in these fields entered a college-level job within a year of graduation.
College graduates who are well prepared to enter the job market should continue to make a smooth transition from school to work. For information on job prospects and entry requirements by occupation, consult the 1984-85 Occupational Outlook Handbook and the 1984 edition of Occupational Projections and Training Data. If these publications are not available at your school or library, contact the nearest Bureau of Labor Statistics Regional Office for information on how to purchase copies for your own use. (Their addresses and telephone numbers are listed on the inside of the front cover of this publication.)
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|Publication:||Occupational Outlook Quarterly|
|Date:||Jun 22, 1984|
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