College Grads Pessimistic

In one of today’s Wall Street Journal columns, David Wessel discusses the remarkable pessimism among those with a bachelor’s degree regarding the future of the US economy despite their clear economic advantage over those without bachelor’s degrees. As the first chart from the article shows, four-year college grads have lower unemployment rates than high school grads (4.2% and 9.7% respectively) and higher median weekly wages ($1,072 and $636). Despite these figures, white male 4-year college grads were actually more pessimistic about the future of the economy than the population overall, with 80% believing the U.S. economy is “going in the wrong direction” (compared with only 74% of the population overall) and 33% expecting the economy to get worse in the next 12 months (compared with only 32% of the overall population). While 4-year college grads may be better off than those holding less than a bachelor’s degree, their pessimism may not be entirely unwarranted. As the second graph from the article shows (also below), the mean income of households headed by a person with a bachelor’s degree peaked in 1999 at $99,431 (in 2010 inflation adjusted dollars) but plummeted to $90,636 last year. According to Wessel, things are worse for recent college grads, for which the unemployment rate is currently 10.7% and he goes on to express his disappointment that “having a college degree no longer guarantees a rising wage or a shot at the American dream.”

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