Sustainable Energy Vs Double Lattes
Emilia graduated in May from UCLA with a degree in Environmental Science. Bursting with excitement and dreams of making a difference, she moved to Seattle, a city renowned for its environmental initiatives. She envisioned herself working with a sustainable energy company, contributing to groundbreaking projects. However, despite her qualifications and enthusiasm, Emilia found herself working as a barista at a local coffee shop.
While she’s grateful for the job and realizes she’s enhancing her interpersonal skills and the ability to handle multiple tasks in a fast-paced environment, it doesn’t utilize her degree or sustainability knowledge. The pay doesn't quite cover her student loan payments and living expenses, leaving her anxious, frustrated and feeling like her fresh potential is dormant.
Emilia's story is all too common among recent graduates. According to the latest data from the U.S. Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey (JOLTS), 46% of recent grads are either unemployed or underemployed. What does being underemployed actually mean, and why is it such a significant issue?
THE REALITY OF UNDEREMPLOYMENT
FOR NEW GRADS
1) Non-Optimized Potential
Just like Emilia, many grads end up in jobs that don't fully utilize their skills and education. Over time, this underemployment can stall career growth and lead to skill atrophy. Imagine the frustration of having a specialized degree and not being able to apply it. It’s like owning a high-performance sports car but driving it only in a parking lot.
2) Lower Earnings
Underemployment often comes with lower salaries, impacting financial stability and future earning potential. For Emilia, her barista job doesn’t pay enough to cover her student loans and living expenses, making it difficult for her to save for the future. It’s a reality check that many new grads face, transitioning from the excitement of graduation to the harsh financial realities of the professional world.
3) Reduced Job Satisfaction
Being in a role that doesn’t challenge or fulfill you can lead to job dissatisfaction and burnout — particularly if you become soured on the job search front and find yourself staying stuck. This emotional toll can be heavy, making it hard to stay motivated and engaged in the pursuit of the job you really want.
Innovative Digital Vs Part-Time Pant Fitter
Carlos’s story offers another perspective on the challenges of underemployment. A recent graduate with a degree in Marketing from the University of Texas, Carlos moved to Austin, a hub for tech and startup companies. He dreamed of creating innovative marketing campaigns for tech firms.
However, after applying to dozens of jobs online, Carlos finds himself working part-time in a men’s clothing store. Carlos strengthens skills in customer service and inventory management, but his marketing skills are underutilized, and he struggles with the lower income. He dreams of using his creative talents in a dynamic work environment, but his current job doesn’t offer any growth opportunities. His initial enthusiasm has turned into a daily grind, making him question his career choices and future.
THE REALITY OF UNDEREMPLOYMENT
FOR THE ECONOMY
1) Underutilization Of Talent
Companies are not maximizing the potential of their workforce, missing out on innovative ideas and productivity gains. Imagine if Emilia’s environmental science skills were put to use in a sustainable energy company — her contributions could drive innovation and efficiency. Instead, while she gains customer service and teamwork skills as a barista, the green company she wants to add value to loses out her specific talents that could contribute to potential breakthroughs.
2) Reduced Consumer Spending
Lower earnings for underemployed graduates limit their spending power, reducing overall demand in the economy and slowing business growth. If Emilia and Carlos had jobs that paid them what they’re worth, they’d have more disposable income to spend, boosting local businesses and the economy as a whole.
3) Impact on Company Success
Companies thrive with motivated, well-compensated employees. Underemployment can lead to higher turnover rates and increased recruitment and training costs. Motivated and fairly paid employees are more likely to stay with a company, reducing turnover and the associated costs.
THE LONG-TERM IMPACT OF UNDEREMPLOYMENT
Comfort Vs Growth
Lisa’s experience further underscores the long-term impact of underemployment. She graduated 7 years ago with a degree in Computer Science from the University of Michigan. Right out of school, she found a job as an IT support technician in Chicago. While the job was a good starting point, Lisa hoped to transition into a software development role.
However, due to a lack of opportunities for growth within her company and comfort with her routine, she remains in the same position, and thus, she's experiencing prolonged underemployment. Though not exactly thriving financially, Lisa enjoys her coworkers, and the work is predictable and familiar. Yet, she feels conflicted by feelings of security and boredom. Lisa begins to weigh the pros and cons of the status quo versus the possibility of exploring new opportunities or additional certifications to enhance her skills and broaden her job prospects.
Lisa’s situation is far from unique. According to a study by the Strada Education Network and the Burning Glass Institute, about 52% of recent college graduates find themselves underemployed within a year of graduation. What’s more concerning is that this underemployment can be long-lasting; more than 40% of those who are underemployed at the start of their careers remain so even 10 years later.
This data highlights a significant challenge for graduates who start in positions below their skill level — what begins as a temporary compromise can turn into a long-term stall in their careers. The implications of this are profound, not just for the individual but also for the broader economy. When talent is underutilized, it hampers innovation and productivity, ultimately limiting both personal and economic growth.
HOW NEW COLLEGE GRADS CAN NAVIGATE UNDEREMPLOYMENT
Understanding these impacts is crucial for both new graduates and employers. For new grads, recognizing the potential long-term effects of underemployment can motivate you to seek roles that truly fit your skills and aspirations. At least, if you need to go the underemployed route for financial or other reasons, make every effort not to stay there long lest it sticks. For employers, leveraging the full potential of your workforce can drive innovation and growth.
This is where my upcoming book, Launch: The New College Grad’s Guide To Getting Unstuck & Empowering Your Dream Career, can make a meaningful difference. Scheduled for release in October 2024, it’s designed to help new grads identify and overcome the obstacles in their job search, ensuring they find roles that match their potential and set them on the path to a fulfilling career.
YOUR OPPORTUNITY AWAITS
Navigating a tough job market can be challenging, but understanding and addressing new college grad underemployment is a crucial step for new grads and the economy. By recognizing the impacts and seeking fulfilling employment, new graduates can contribute to a more innovative and productive workforce and can set themselves up for a long, happy and consequential career of impact.
Stay tuned for more insights, and check out Launch, now available fore PRE-ORDER. Together, we'll transform your job search from a daunting task into a successful adventure. Here’s to finding — and landing — your dream job!
P.S. If your dream job is eluding you, DOWNLOAD the free Job Search Success Audit now so you can see where you're stuck and fix it.
Maria Katrien Angeleva, MA, MA
Certified Coach, Author & Trainer
Dubbed “Professor Dream Job,” by her students, Trie is a former COO and founder of Reimagine Monday. She specializes in helping individuals transform their careers and lives through mindful, strategic approaches. Trie developed and taught career success courses at Indiana University, building on her proven methodology, The Love Monday Method. Her latest release, Launch, designed to help new college grads get unstuck in their search and empower their new career, is now available for pre-order.
With two Master's degrees, a Certificate in Executive Leadership from Cornell University, six coaching certifications and a deep passion for guiding new graduates and professionals in their prime, Trie supports individuals in navigating their career paths with clarity and confidence, and is dedicated to helping YOU turn your dream job into a reality.
Connect with Trie at trie@reimaginemonday.com.
