Throughout the past few months, we have explored student outcomes at various points in the higher education lifecycle: retention and persistence, graduation, and post-graduation earnings. For the blog posts in June, we will continue utilizing the US Census Bureau’s Post-Secondary Employment Outcomes (PSEO) data that now provides earnings and employment data for 11 partnership states (Colorado, Connecticut, Louisiana, Maine, Michigan, New York, Ohio, Pennsylvania, Texas, and Wisconsin), including the recently added state of Indiana. This blog post will use data from the PSEO Flow dataset that will look at the percentage of bachelor’s degree graduates from Doctoral Institutions who graduated between 2001 and 2015 and who have been classified as non-employed or marginally-employed based on US Census Bureau’s access to nationwide earnings data.
Within conversations about post-graduation employment outcomes, the topic of “underemployment” is likely to be expressed by thought-leaders within higher education. According to the Federal Reserve Bank of New York’s Economic Research division, which publishes regular updates on a variety of labor market data for college graduates, “The underemployment rate is defined as the share of graduates working in jobs that typically do not require a college degree.”
In the chart to the right, you can see underemployment rate trendlines for two groups of graduates: Recent and College. “Recent graduates” are those aged 22 to 27 with a bachelor’s degree or higher, while “College graduates” includes those aged 22 to 65 with a bachelor’s degree or higher. There has been variability for Recent graduates spanning the 31 years of data included in the chart. While the overall average underemployment rate for Recent graduates is 43.1%, the underemployment rate values ranged from a low of 36.6% in April 2001 to a high of 48.4% in November 1992. Broken out by decade, the 2000s had the lowest underemployment rate for Recent graduates of 41.5%, with the 1990s at 43.8%, and the 2010s at 44.2%. For the College graduates group, the 31-year average is 34.3%, with a low of 31.4% in June 2000 and a high of 35.1% in February 2014. Across decades, the underemployment rate has crept up slightly from 33.3% in the 1990s to 33.4% in the 2000s to 34.5% in the 2010s.
NOTES: Clicking on the chart will take you to the source web page, where an interactive version of the visualization along with additional data may be accessed. The underemployment data appear to include all institutional types (e.g., public, private, and for-profit).
In the US Census Bureau’s PSEO data, there is a slightly different construct that is analogous to underemployment shown above: non-employed or marginally employed (NME). According to US Census Bureau’s documentation, “Workers who do not meet the labor force attachment restrictions…are counted in the residual measures” that are referred to as “non-employed or marginally employed” (US Census Bureau). The two restrictions exclude graduates who “earn less than the annual equivalent of full-time work at the prevailing federal minimum wage” and “graduates with two or more quarters with no earnings in the reference year.” We include the underemployment data above to provide comparison for the remaining discussion of the PSEO non-/marginally-employed data.
In the visualizations below, we present the NME percentages by university across the three timepoints (1, 5, and 10 Years after graduation) included in the PSEO data broken out by Carnegie Classification for Doctoral Universities. The size of each university data point corresponds to the number of graduates included in the PSEO data at each timepoint. To differentiate Texas institutions, the color-coding of the data points corresponds to public university system affiliation in Texas, with all out-of-state institutions shown in a light-gray color. We have also included distribution data for each timepoint, showing the group averages along with box plots that help identify outliers in the data. When interpreting the institutional rates compared to the group average, it is important to note that an NME rate above the average means that a higher percentage of bachelor’s degree graduates from that university were non-employed or marginally-employed when compared to the group average. Institutions located below the average are performing better on the NME metric than institutions located above the group average.
Doctoral Universities: Very High Research (VHR) Activity
Doctoral Universities: High Research (HR) Activity
Doctoral Universities: Professional Universities
NOTES: If you are unable to read the labels in the visualization below, we recommend clicking the “Full Screen” button on the lower right of the visualization window to enlarge the information. Hovering over each point will provide a tooltip with additional information. If you want to “Highlight” just the Texas institutions further, place your cursor/tap in the box labeled “Texas/Out-of-State” and select “Texas” from the drop-down menu. This will also show the averages for Texas institutions in comparison to the overall average at each timepoint.
In the visualization below, we can see a comparison of average NME rates by Doctoral University Carnegie Classification, showing that all three groups demonstrate the same pattern: a drop in the NME average from Year 1 to Year 5 after graduation, with an uptick in NME average rates from Year 5 to Year 10 post-graduation. The rank order of the averages for Doctoral Universities may be surprising, as over 1/3rd of bachelor’s graduates from the Very High Research Activity (or R1) universities in the PSEO data are either non-employed or marginally-employed during the first year after graduation. By comparison, just over 26% of bachelor’s graduates from Doctoral/Professional Universities were non-/marginally-employed during the first year post-graduation, which is an 8.2% difference between this group and the R1 institutions. The gaps between the three Doctoral University groups narrows over time, with just 3.2 percentage points separating the highest and lowest group averages in Year 10 after graduation.
When comparing the decline in NME rates from Year 1 to Year 10 in the PSEO data to the underemployment data presented at the top of the blog post, the NME trends seem to mirror the longitudinal data from the Federal Reserve Bank of New York report. As graduates move from the “Recent graduates” to the “College graduates” when turning 28-years-old, the average underemployment rate drops from 43.1% to 34.3% historically, representing a 20.4% decrease. When averaging the NME rates across all Doctoral Universities in the PSEO data, the change from the overall average of 31.4% in Year 1 to 24.6% in Year 10 is a 21.7% change. These changes over time seem to indicate a similar pattern existing across the two data types, where the longer graduates are in the workforce, the lower the percentage who are either underemployed (as per the Federal Reserve Bank of New York definition) or non-/marginally-employed (as per the PSEO definitions). Future PSEO data should allow for longer-term comparisons of employment and wages similar to the underemployment data.