College Degrees: A Commodity? -- Michael

It used to be a big deal to graduate from college. With your degree in hand, you had a ticket to the upper middle class lifestyle.

But these days, so many people are graduating from college that the diploma means less and does not have the same economic clout.

By Michael Mandel Wed Aug 30, 3:08 AM ET

Young college grads are taking it on the chin. That's what the new data from the government show -- and it's not a pretty sight.

On Tuesday, Aug. 29, the statisticians at the Census Bureau released the latest numbers on income and poverty, for 2005.

. . .

Perhaps the most distressing figure was one buried deep inside the detailed tables. It turns out that the median earnings of young college grads, adjusted for inflation, fell by an astonishing 3.3% in 2005. That's on top of similar declines in 2004 and 2003. All told, the earnings of young college grads are down by almost 8% since 2002. [For a related chart, see BusinessWeek.com, 8/29/06, "Young College Grads in Free Fall."]

By young college grads, we mean full-time workers between the ages of 25 and 34, with a B.A. but no advanced degree. These are people who first entered the workforce during the past 10 to 12 years, some during the boom, some during the early years of the bust. What they've experienced over the past several years is an unrelenting downdraft in wages, probably the first sustained decline for college grads since the 1970s.

Back in the day, you got out of college, worked a few years to get established, and then you bought your starter home and had kids.

Not any more.

What's more, many of them have also been stuck on the wrong side of the housing boom. Just coming out of college, they didn't have the savings or the income to buy a house. And with home prices rising faster than their incomes, it's been very hard for them to catch up.

Pocket of Pain for Young Graduates

posted by Ace at 12:03 AM

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