The Educated Precariat: Mandarin Spoilage

This post is a continuation of my series of posts on economic precarity.  As I mentioned in recent posts in this series, we have begun to delve the subject of the educated precariat - that is, those people in the early 21st century who have obtained either bachelors or more advanced graduate degrees from a college or university, yet who cannot find stable work in their chosen profession.  The most recent previous post in this series discussed the origins and evolution of the modern university as a European institution and its spread as a model of higher education throughout the world.  That post also discussed the late-stage signs of dysfunction which have begun to appear in the modern university system during the last 40 years, particularly in English-speaking countries such as the United States and Australia.

Today's post will consider the university system as a machine that produces components for use within the larger machinery of modern late-stage capitalism, and what is happening to those components because of the fact that there are more components being produced than there are slots into which to plug those components.  The "components" in this case are recent college graduates.  Historically, an American guy or gal who managed to earn a mortarboard perched on his or her head, an academic robe on his or her body, and a sheepskin in his or her hand could expect to pursue one of two possible vocational paths after graduation:

• He or she could become a career scholar, otherwise known as an academic.  This academic career could be focused on teaching or on research, or on a mixture of both.
• He or she could become a member of the professional class, the "managers, officials, and professionals" described by Gary Roth in his book The Educated Underclass.

The next three paragraphs will cite extensively from Gary Roth's book.  

The prospects for those college graduates pursuing either path were very bright from the late 1800's until around 1970.  This was true because the rapid expansion of the American economy and the growth of urban populations produced a need for professionals with the requisite training to serve the resulting societal needs.  The pre-existing system of private higher education was inadequate to produce these professionals, as noted by Roth: "Tuition-driven institutions have never been a viable model at any level of the income spectrum ..."  Thus the government (at both the Federal and State level) intervened to fund public universities that could fill the demand for degreed professionals and managers.  These universities became important research centers which boosted commercial development as they published their research findings, particularly in agricultural science.  These public universities also helped to rapidly expand education in law, medicine, and engineering.

Although the absolute number of degreed professionals thus steadily increased, the number of these professionals as a percentage of the total American population remained small until World War Two.  On the eve of the war, less than 5 percent had a four-year college or university degree.  However, the war drastically increased the need for degreed professionals, and the G.I. Bill of 1944 stimulated the supply of these professionals and the expansion of the American public university system.  This stimulation was amplified by other non veteran-related Federal and State funding for higher education.

The demand for the graduates of this expanded higher education system was fueled by the drastic expansion of the managerial class of the American business sector.  For instance, between 1950 and 1970, the number of American white-collar workers grew by 75 percent.  Many of these workers could be considered to be "private-sector mandarins" involved in management and the administration of big business bureaucracy.  The growth in the numbers of these private-sector mandarins was paralleled by the growth in public-sector mandarins as Federal and State governments expanded.  Indeed, the number of State and local government employees increased much more drastically than the number of Federal employees.  The demand for graduates was also fueled by the growth of the public university system itself, which saw the addition of 200,000 faculty positions between 1950 and 1970.  Thus in 1970, higher education had come to be seen as a guaranteed means of upward social mobility.  By 1970, 32.1 percent of all Americans between 18 and 24 years of age were enrolled in some sort of college.  

But 1970 was the beginning of a tangible slowdown in American fortunes, a tangible curbing of American power and prestige.  Some of the causes were obvious, including the rejection of American values by many nations of the Third World, and the loss of prestige of the American military in Vietnam.  One of the causes was hidden to most observers, namely, the peak in American conventional oil production which occurred in 1970 and the beginning of the outsourcing of American manufacturing to other countries with cheaper labor.  These changes wrought changes in the American economy which began to curtail the opportunities open to people holding college degrees.  Although the conventional wisdom held that a college education remained a key to upward mobility, reality began to look different.  A growing number of college graduates began to experience the phenomenon of underemployment, that is, working in jobs which require less education than the job-holder possesses, or, working in jobs which offer less than stable full-time employment even though the job-holder would like to be fully employed.  Let's close this post with a discussion of both types of underemployment.

First, although underemployment has gained recent attention as part of the phenomenon of precarity, there are sources who indicate that underemployment has existed for the last several decades.  For instance, a 1963 U.S. Government publication titled, Two Years After The College Degree states that "Two years post-graduation, 18 percent of the class of 1958 reported that a four-year degree was not necessary for the jobs they held." (Roth, Chapter 4.)  However, Gary Roth points out that those graduates were living in an environment in which there was a surplus of available job positions and a relative shortage of workers with college degrees.  

That has not been the case for at least the last two decades (and perhaps longer).  For instance, in the 2013 paper "Why Are Recent College Graduates Underemployed?" by Vedder, Denhart and Robe, Figure 10 shows the number of degree holders who occupy certain occupations which do not require a college degree, and shows how the percentage of these jobs occupied by degree-holders has increased between 1970 and 2010.  Note, for instance, the steep increase in the number of college-educated taxi drivers, salespersons, and retail clerks.  Also, in the 2014 New York Fed paper "Are Recent College Graduates Finding Good Jobs?" by Abel, Deitz, and Su, we can see that already by 1990, the underemployment rate for recent college graduates was over 40 percent.  Younger college graduates had underemployment rates that were nearly 50 percent.  Recent college graduates who were working part-time after graduation were also above 15 percent in 1990.  Those recent college graduates who occupied low-wage jobs was around 15 percent in 1990.  These numbers did not show any consistent long-term improvement from 1990 to 2014.

According to Vedder, Denhart and Robe, the number of Americans with a bachelors degree or higher was expected to grow by 31 percent between 2010 and 2020, whereas the number of actual jobs requiring such degrees was expected to grow by only 14.3 percent.  This would translate to 19 million additional Americans with bachelors degrees or higher compared to only 7 million additional jobs requiring such degrees.  This would also mean that the number of underemployed graduates would increase to 30 million.  

What's more, those who start their post-graduation careers underemployed are at great risk for remaining underemployed five and ten years after graduation, as noted in "The Permanent Detour: Underemployment’s Long-Term Effects on the Careers of College Grads," a 2018 paper by the Strada Institute for the Future of Work and Burning Glass International, Inc.  According to this paper, 43 percent of college graduates are now starting their post-graduate careers underemployed.  Of these, 29 percent will continue to be underemployed after five years and 23 percent will be underemployed after ten years.  The figures are worse for women: 47 percent will start out underemployed and 31 percent will be underemployed after five years.

Why is there such a mismatch between present-day numbers of college graduates and the present-day number of education-appropriate job positions for these graduates?  What coping mechanisms are the college educated precariat using to cope with underemployment?  And how are these coping mechanisms affecting those members of the precariat who do not have a college education?  We'll start tackling those questions in the next post in this series.