A recent study has found that the first job out of college is critical to people's later career development, as those who graduate into underemployment rather than a full-time job have a much more difficult time leaving underemployment, even many years later. The study—conducted by Burning Glass Technologies, a job market analytics firm, and the Strada Institute for the Future of Work—examined the common phenomenon of college graduates working not in the field they trained for, but in positions such as barista, waiter or Uber driver.
What they found was that 87 percent of workers who had full-time work right out of college tended to hold positions matching their education levels five years later, and 91 percent of those employed at the five-year mark continued to be appropriately employed 10 years later. Conversely, those who were underemployed right out of college (roughly 43 percent of college graduates) were five times more likely to remain underemployed five years after graduating. By the time 10 years pass, 75 percent of those who started out underemployed remain underemployed.
This phenomenon comes with significant financial penalties that reverberate throughout the graduates' careers. People working at a place like Starbucks, versus somewhere more appropriate for their area of study, are not developing on-the-job skills relevant to their chosen career, which means that even if they do eventually find relevant work, they will do so with a smaller knowledge base than those who were hired right out of college.
"Take two graduates, for example: one goes to work in a human resources department, the other becomes a bartender. After three years, the HR staffer has learned about compensation and benefits and has skills valuable to a range of employers. The bartender has gained no such transferrable expertise. And even if he wanted to go into human resources, he would likely be competing with a recent graduate with lower salary demands," said the report.
Overall, the report found that only a third of initially underemployed graduates moved within five years into work requiring a bachelor's degree, and they generally remained in appropriate employment from that point on. Meanwhile, of those who began with a bachelor's level job, 13 percent slid into underemployment five years later and found it difficult to recover, as two-thirds of backsliders remained underemployed 10 years after graduating.
Whether or not one ends up underemployed after college can vary greatly depending on one's major. Engineering; computer and information sciences; communications and media; mathematics and statistics; and foreign language, literature and linguistics majors are the least likely to be underemployed after graduating. Conversely, those who major in security services; parks, recreation, leisure and fitness; family and consumer sciences; liberal arts, general studies and humanities; and natural resources and conservation are the most likely to end up underemployed.
(Business, management, marketing and related support services majors, which one presumes to include accounting, were almost at the exact middle of the list. Such graduates have a 47 percent chance of being underemployed post-graduation and a 31 percent chance of still being underemployed five years later).
Meanwhile, the type of job one has right out of college also plays a large role in whether or not someone escapes underemployment. Even if someone is underemployed, if it's in a field where there are already many bachelor's-level jobs, then that person is much more likely to be appropriately employed within five years. For instance, recent graduates who are underemployed in a field related to computers and math, such as IT help desk workers, have a 51 percent chance to eventually go on to appropriate full-time work. By contrast, those whose first jobs are in the building/grounds cleaning and maintenance fields have only a 23 percent chance. Business and financial operations, incidentally, have a 38 percent probability.
Overall, the report also found that women are more likely to start out underemployed, and therefore remain underemployed. It said that 47 percent of female college graduates, versus 37 percent of male graduates, leave college underemployed. While women with STEM degrees are less likely to be underemployed than those in other fields, they still have a higher probability than male STEM graduates.
"In all, our findings underscore the critical importance of the handoff between education and the workforce," said the report. "Early employment choices are a dress rehearsal for the rest of life. Young adults underemployed after graduation can’t consider it just a phase that they’ll escape from in a few months because a few months can easily turn into a few years and eventually an entire career."