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New College Grads: Your Retail Cashier Job Awaits You

By John Morgan   |   Wednesday, 30 Jan 2013 08:04 AM

The trend of more recent college graduates working as bartenders or taxi drivers is one that is unlikely to change, in part because more Americans are getting higher degrees, while job growth is centered in occupations requiring fewer skills, according to a study by the Center for College Affordability and Productivity (CCAP), a non-profit research organization.

Richard Vedder, an Ohio University economist and founder of the center, said the mismatch between those receiving college degrees and new available jobs appears to be the “new normal.”

Using Labor Department data, the study concludes the number of college graduates in the workforce in 2010 was larger than the number of jobs requiring a college degree — and the disparity is growing.

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According to Vedder, that helps explain why 15 percent of taxi drivers in 2010 had bachelor’s degrees, compared with less than 1 percent in 1970. Among retail sales clerks, 25 percent had a bachelor’s degree in 2010. Less than 5 percent did in 1970.

“There are going to be an awful lot of disappointed people because a lot of them are going to end up as janitors,” Vedder told USA Today about future college graduate trends.

The study acknowledged job growth generally has been sluggish since the 2008 financial crisis, but that “any thought that this is a temporary problem related to the business cycle is wishful thinking.”

The study estimated the number of Americans graduating with bachelor’s degrees would grow more than 31 percent to 19 million during the current decade, more than double the growth percentage of the 7 million new jobs requiring a bachelor’s degree.

“We are essentially creating a glut of overeducated persons who will be forced to perform relatively simple unskilled tasks requiring little in the way of educations skills,” the study concluded.

The study noted there are two major economic issues facing higher education — it is too expensive and it encourages massive public investment in higher education while ignoring labor-market realities. The result is that the United States is “vastly wasting scarce resources, both public and private.”

Few of the 30 most common occupations projected by the Labor Department to have the largest job growth until 2020 require a college degree. The exceptions are nurses, teachers, accountants and physicians.

Of the most common occupations not requiring a college degree, the study estimated the percentage of college graduates taking jobs in some of them in 2010, such as retail (24.6 percent), recreation or entertainment attendant (23.5 percent), telemarketing (18 percent) and bartenders (16.5 percent).

“There are over 1 million people with bachelor’s degrees who are retail sales clerks in the United States,” Vedder told CNNMoney. “That blew my mind.”

CCAP stated that one unanswered question is whether President Barack Obama’s goal of further increasing college degree attainment is really desirable.

The Consumer Financial Protection Bureau estimated in March 2012 that student debt in the United States had passed $1 trillion, Bloomberg BusinessWeek reported.

The cost to the taxpayer may be high, also. In 2010, the Education Department decided to try to save $60 billion over 10 years by making all new federal education loans directly, eliminating middlemen.

Editor's Note: How to Pay Zero Taxes . . . Legally

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