An Unemployment Epidemic For College Graduates

There's an unemployment epidemic among college graduates, largely thanks to the pandemic. Over 22 million jobs were lost due to the pandemic, and about 65% have been recovered as of 2Q2021.

According to one study by TwentySomething Inc, 85% of 2011 college graduates are moving back home with their parents. Meanwhile, another study shows that the real unemployment rate for people 25 years old and younger is a whopping 54%! I'm generally very wary of the mass media, because they are filled with bitter journalists who enjoy the pleasure in the suffering of others. However, even if we cut the percentages in half, these figures are still quite worrying.

There's clearly two bubbles in the world today.  One is the most awesome Social Media bubble which is a godsend for those in the Bay Area who've been praying for another bubble to arise ever since the dotcom crash of 2000.  The second obvious bubble is in the education industry! 

Parents and kids alike are delusional into think that private schools are worth their $50,000 a year in tuition.  Some are, but the majority of schools aren't worth it.

Defend Yourself From Unhappiness And The Unemployment Epidemic

On the one hand, many are unsatisfied with their existing jobs. On the other hand, many can't get jobs after college and therefore start rebelling against the 9-to-5 system. What results is an all around dissatisfaction which sucks ones soul. It's understandable to reject society if society rejects you.

Is there any wonder why we seek entrepreneurship so aggressively? We want to be masters of our own destiny, without anybody causing us grief and telling us what we can and cannot do. Unfortunately, nothing good comes easy and we'll likely have to still live in mom's basement while we try to build our empires.

Related: What If You Go To Harvard And End Up A Nobody?

Debt Is A Dream-Killer

The biggest reason why a 54% unemployment rate for people under 25 is so worrying is because of debt. In the video below, the unemployed college graduate spent a mind-numbing $200,000 to go to George Washington University. GWU is definitely one of the better universities in the nation, but $200,000 over four years is absolutely a ridiculous amount of money!

$200,000 for Harvard might be palatable, but $200,000 for GWU? No way in hell would I ever pay for my kid to go there.  If you aren't in the top tax bracket, and your kid isn't getting any scholarship help, it's irresponsible for parents to allow their kids to go to such a school.

Instead, I'd ask my child to go to UMD, UVA, William & Mary, Mary Washington, and Virginia Tech if there was an insistence of staying in the Northern Virginia area for 1/3rd the cost.

If you had no debt after college, it frankly wouldn't matter too much if you were unemployed for 6 months, or 2 years after graduation. There's no debt service to pay, or thunderous pressure to do something with your life after school. With zero debt, you could spend a year bootstrapping your own business to see how you'll do, with no pressure.

You could take a job overseas making only $12,000 a year purely for the joy of experiencing a new culture, with no pressure. Being debt-free sets you free!

Related: Ranking Debt Types From Worst To Best

Ways To Save Money And Fight The Unemployment Epidemic

The undergraduate degree is seriously becoming commoditized. As a result, the gap in prestige between going to Chico State for $5,000 a year and Yale for $50,000 a year has narrowed considerably. As a hiring manager, I'll definitely give the edge over the Yale graduate, however, post undergrad positions are generally menial roles anyway, so it doesn't matter so much!

One of the best ways to save money on education is to just go to the best state school possible. Pretty much all undergraduate institutions teach from the same text books, so the educational portion is roughly the same. Some of the best schools in the nation are state schools: Berkeley, UCLA, UCSD, Michigan, Virginia, Wisconsin, and so forth.

The next best way to save is to simply go to community college for a couple years, get fantastic grades and then transfer to that fantastic state school of your dreams. When you graduate, you'll still have the same diploma as someone who went all four years.

Final Way To Fight

Finally, there are literally millions and millions of dollars in scholarship money for students who simply try. “Try” is the imperative word here, because if you never try, you will never get any money. You can go on sites like to search for tons of scholarships.

Or, you can participate in the quarterly Yakezie Writing Contest, where we give away at least $600 to the first place winner, $300 to second, and $100 to third. I'll accept via e-mail five individual entries from those who've discovered our educational micro-giving effort through, since the deadline is closed.

You've just got to make the effort. I remember always being amazed at my classmates getting scholarships left and right during college. I never believed I would win anything myself until I applied for one, and voila, I received $500 bucks that went towards my study abroad trip.

It's Real Money Folks!

If you or your parents have the money, by all means, go to your expensive private school. But, if you are like most Americans, with an average household income of under $100,000, then you might want to reconsider spending so much money on just an undergraduate education if 50%+ of Americans under 25 are unemployed. You don't want that type of weight on your shoulders at a time when all you want to do is soar.


The Best States For Unemployment Benefits


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51 thoughts on “An Unemployment Epidemic For College Graduates”

  1. There used to be a time when our greatest generation the ones that fought WWII could finance their entire education on GI Bills and govt educational grants. Doctors could graduate from med school with no debt and make good livings as primary care physicians without the smartest and best having to go into non essential medical areas such as cosmetic surgery.

    Now their grandchildren are saddled with private student loan debt equivalent to a home mortgage and salaries that barely cover living expenses.

    The govt used to do amazing things during a time when America manufactured and exported things. Now instead of Ford/GM putting entire communities to work we have Facebook/Twitter enriching a handful of nerds and keeping the masses distracted from their problems with virtual nonsense.

  2. Sunil from The Extra Money Blog

    i completely agree with this article. i went to MI, which at the time was a state school for me. and no i dont think grads are “forced” to live at home. there are plenty of options out there, studying/working abroad is one of them

  3. @Joe
    Good stuff! UCLA rocks too. I love the campus, the athletics, and the lifestyle.

    At least you didn’t graduate in 2008, 2009, or 2010. Those years were even worse. Everything is relative!

    @Debt Free Divas
    No prob DFD. Hmmmm, well you learned that debt really bothers you, and as a result, you won’t be taking on much debt in the future. Sounds like progress!

  4. Spent about 12k for an RN degree from a community college only to find the market is saturated with too many nurses, not just in my area of the country, whole country. I graduate this month. Given that knowledge, it would be financial suicide to even attempt a bachelors. I’ll move to rural Idaho for a job long before I step back into the halls of academia. 3 years of mind numbing frustration and nothing to show for it.

    With some type of marketable skill in hand, I feel now I can slump back into serious self-study and fill-in the gaps that college doesn’t provide.

  5. It seems to me that with public and private tuition costs on the rise, students who rely on loans for education and cost of living expenses are going to be in a lot of debt no matter what. It all boils down to knowing how to plan your finances ahead of time. It’s more convenient to just take out loans rather than save up for your education, but all that debt can accumulate fast. Parents should start teaching their kids the principles of financial planning and set up a savings account sooner. It may not pay for a full four-year education, but any way to cut down on those hefty loans is an improvement, if you ask me.

  6. As a recent graduate who recently secured employment I feel the pain of new graduates. The economy sucks right now and it is still in the recovery phase. However, I decided to go to a public college in state and recieved free tuition for my first few years. Now I just have to repay the small amount of student loans that I took out to get my second more profitable degree.

  7. I went to a public university (our tuition is heavily subsidized- it only cost me $5000 a year for tuition at an candian “Ivy League” school).

    I know a friend who went to a local community college, got kick ass grades, transferred to university, and now she’s a medical doctor because she had such kick ass grades.

    So your suggestion is a good idea! As long as they can stay focused in community college, I suppose.

    I agree that there is this epidemic of OVER educated UNDER employed young people. Even traditional “practical” degrees like nursing, new graduates are having trouble finding jobs. They’re moving down south to the USA for jobs.

  8. I hope the stats aren’t that bad for recent grads. It seems like a lot of places are hiring so hopefully more people will be able to get jobs in the next few months and not have to be stuck with mom and dad. I would have a hard timing being under the same roof as my parents but it is a great way to save money when in a pinch.

  9. I went to a community college then transferred to a state school for my undergrad. It wasn’t prestigious, but that didn’t matter to me. I graduated debt free. I’m now back in school, the same state university I received my BA from, and it is still a deal (though the cost is 4 times what it was years ago!) If I were on a hiring committee and interviewed two candidates that were fairly equal in GPA and experience, I think I’d hire the one that went to a state college that didn’t cost a fortune. It tells you a little about that person, or their family: they’re financially savvy. Graduating with $200K in debt for an undergrad degree!? What was that chick smokin’?!

    P.S. Scholarships are always available through specific departments as well. I’ve already received $1,500 in scholarship money through my education credential department with very little competition (most students don’t want to put in the effort of writing an essay and collecting recommendation letters.)

  10. Daniel Rosenhaus

    Just want to say, going to a state school was one of the best decisions I made, less than $15,000 a year and going to a cheaper city improved day to day costs too.

    But in terms of getting a job, doing well in school is very different. In school, doing well is about just doing what you are supposed to do and being smart, hard working or like-able. Getting a job is about having specific skills that can help a company make more money, or knowing someone who can give you a job. If all you are is smart, find a job doing research. Being a genius doesn’t help you, like it does while in school, unless you apply to something people are going to pay you to do.

  11. Fees for tertiary education are insane. And they will continue to rise, especially private schooling.

    What’s surprising though is that education inflation outstrips CPI (at least in South Africa) by at least 8%. This means that you need an investment plan that not only kills CPI, but manages to keep up with education fees.

  12. Also, to add, now that I’m in the position of a hiring manager, for undergrads with little relevant experience, the specific college IS important. You can make up for that with interesting experience, but without that, you can bet your college name is going to open doors or close doors. I’m literally not allowed to interview anyone who went to Chico.

  13. I went to a private school — where the annual tuition was 3x higher than that of a top state school I had been accepted to — and the program in which I enrolled had an even higher tuition fee. At the time I was a student, with room and board it was probably $35k per year for 4 years.

    Was it worth it? Maybe. As I just wrote on my blog, I’ve managed to increase my salary from $18/hr for part time work right after graduating to $90k today, 5 years later. I know I wouldn’t be where I am today had I gone to the state school – though I might be in a comparable place, and my parents would have spent less money on my undergraduate degree.

    I was very lucky in that my parents paid for my undergraduate education outright. They had saved up enough money to do that without taking out loans, so I graduated debt free. If I had debt, it would have been scary, and even more depressing. Instead, I was able to intern and work for cheap after graduating until I got my footing. Even then, as I write in my blog, I’ve gone through plenty ups and downs including lay offs and unemployment. If I had debt, well, I wouldn’t have been able to pay my rent, live far from my parent’s house (on the other side of the country) and keep applying for better jobs even when my hiring prospects seemed futile.

    There is definitely an education bubble right now, and it’s going to really hurt everyone in the long run. The cost of higher education is way too high, and the middle class are hurting from it the most. At some point, this bubble has to burst.

      1. I don’t feel an obligation to pay it back to them, but I do feel an obligation to pay for “my children’s” education in the future (if I end up having kids.) And I’m sure that will be much more expensive than $80k+.

  14. Unless I missed it, nowhere in the video did it mention the student’s major. That’s kind of an important factor in job prospects, seems like a pretty big omission. Anyway, I’ll refrain from taking on particular majors based on last week’s train wreck at my site, but students realistically need to assess what kinds of majors are attracting the most interest from employers. At least over the next few years, sure, computer engineering is hot; the valley can’t get enough of them. Nursing’s hot since there aren’t enough of them. Nuclear engineering is hot since the entire population of hires from when we built plants in the 70s is now reaching retirement. Mechanical Engineering at Michigan state? Not what it used to be post big 3 bailouts. People have to be realistic, not “idealistic”.

    To your question, I went to a state school and have always done fine, but I did have the fortune of graduating into a decent economy where employers were hiring.

  15. Even 100K seems like an incredible amount to pay for a 4 year degree. I did the JC thing (actually, several JCs), and then transfer to a state University. But it was 20 years ago, and it appears that tuition has inflated tremendously since then.

  16. Man, when I read these articles and comments it makes me glad I went to school in Canada. I am usually all for less of a government role in anything, but I think we strike a nice balance when it comes to education up here. Most public universities are very affordable for the vast majority of faculties. You might be looking at 20-30K a year in faculties like Dentistry or Medicine, but those professional faculties will only keep you for a few years and then you are released into a profitable career. Undergraduate degrees are much more reasonable at 4-7K per year at most places.

    A really nice program that we have up here is called a Registered Education Savings Plan. It is a program that gives a strong incentive for parents to save for their child’s education. In short, the government will give a grant worth 20% of what parents contribute to the plan (up to $500 per year). Therefore, a parent can contribute 2.5K a year every year after the child is born and the government will kick in 500 to make it an even 3K. The money inside the RESP can be invested however you like, and the investment income is all tax-free until the student takes it out to pay for school. When it is taken out by the student it is taxed in their hands, which usually means it is not taxed at all due to the low income of most students. If a child does not go on to post-secondary education the money can be transferred penalty-free to another child, or rolled into a Registered Retirement Savings Plan (but in that case you have to sacrifice the grant). Basically, it rewards parents who don’t stick their heads in the sand. If parents want to teach their kid responsibility they can always ask them to pay the principal back after graduation. Chances are it will be much smaller than a student loan would have been (and probably at a lower interest rate).

    1. You guys are lucky that you have affordable healthcare and cheap education! UBC and McGill are great schools!

      I wonder though, how come I’ve never heard of any famously rich Canadians like Warren Buffet, Bill Gates, or Mark Zuckerberg? Also, the 40% tax rate is a killer on such a low hurdle imo. Pls educate me! thx

      1. UBC and McGill are great schools, but I would venture they are just 2 of many. The schools in Southern Ontario are usually pretty highly ranked, and even the prairie universities such as the University of Manitoba, U of Saskatchewan, U of Calgary, and U of Alberta, all have some fairly prestigious professional faculties. In most circles I have heard them discussed as being a solid tier below Ivy League in the states, but certainly on par with George Mason for example.

        The healthcare is another issue however… I think it could be much more efficient, and a two-tier system is probably the best and most affordable idea (especially as we face an ageing population).

        There aren’t any ultra, ultra-wealthy Canadians on a world scale that I am aware of. David Thompson who resides in Ontario was in at over 23 Billion in 2010. We had over 60 billionaires as of 2010 (in a population of 35 million or so) which that is not bad. My guess is that a lot of the ultra-wealthy people probably list their home somewhere else for tax benefits.

        We do have a 40% income tax rate at a relatively low level, but check out our business tax rate of only 11-15%! Much lower than the USA’s at 35-39% last I checked . It’s the best kept secret that “Communist Canada” has. At some point I hope to start a consulting business as a LLC and take advantage of the business tax rate.

  17. I think a lot of people are over-educating themselves too, which is preventing them from getting the job they “want” versus what they are qualified for. I have an acquaintance with no job experience, but got their BA, MBA, and now JD. She can’t get the job she wants – general counsel – because she has never done it before. She is only getting offers for entry level jobs!

    1. the good news is that one day when she works up to the position she wants, she’ll have the credentials to get it. that’s not always the bad way of approaching a career, but she has to be willing to start out at entry level. she’ll probably move up much quicker.

  18. Steady Eddie

    I earned an undergraduate engineering degree from a state university. Worked summers and part time combined with partial scholarships to fund….graduated with no debt. Attained MBA several years later….tuition, fees and books covered by employer.

    My daughter recently graduated from a state university with a business degree. About half the cost was covered by an academic scholarship; wife and I paid the remainder with no recognizable impact to our lifestyle. Daughter graduates with no debt and has already obtained employment. She was offered and accepted a position with a highly regarded corporation following an internship last fall. She will however, be counted among those graduates returning home. We agreed to allow her to live with us up to a year to save for a down payment on a home.

    I am convinced the college experience and resulting degree benefit is attainable for most everyone with a little sacrifice and perseverance.

  19. This is scary stuff. One question I have, though, is what the unemployment rate is by field of study? What is the unemployment rate for business school grads vs. engineering vs. arts/history/English. I bet there is an unsurprising trend if you can dig deeper into the data.

    1. Donno, but with a 52% unemployment rate, I don’t think it’s way more than just a major. Sure, engineers and technical majors might have a lower rate, but I’m sure it’s still high.

  20. hard for college students that have thousands of dollars in student loan debt. might sound rash but i dont think you should think of college any differently than anything else, if you can’t afford it then dont’ buy it.

  21. Alternatively, the Government is going to pull out of the system and the whole thing is going to CRUMBLE. Then the bubble will burst for colleges because Students won’t be able to obtain cheap funding.

  22. I went to private school, got scholarships, got good grades. Although scholarships can pay for the school itself it doesn’t always pay for actually surviving (rent + food). The cost of my school was in the neighborhood of $44,000 a year so I count myself one of the blessed few when I say my fiancé and I walked away with under $100,000 in debt (which is doable on our incomes).

    I highly recommend trying to get scholarships every year (not just before school), my 4th year and masters were almost completely paid for because I kept trying to get scholarships each year. For now I just throw extra money towards the student loans to pay them off at an accelerated rate.

    1. Gulp, $100,000 in school loans is a lot. What field are you in now or what type of income 2-5 years out is needed to justify this type of debt load? There’s a number for everything.


  23. I graduated from a private college without debt. My children went to UC and graduated without debt. My children lived with us after graduation for a short time because they needed time to save for the deposit required to move into an apartment. The current unemployment reflects the economy, however many bright, articulate students are not prepared for the job search. This is due to a variety of reasons such as a liberal arts degree, no experience, poor resume and lack of interviewing skills. In better times, someone with a liberal arts degree would probably enter a training program.

  24. Nunzio Bruno

    I agree with “Debt-free sets you free”. Being under a lot debt is something most people have been trying to solve and get out of for the longest time. So is the unemployment problem.

    Every year, there are millions of graduates from private colleges or universities that are forced to stay with their parents while waiting for a decent job offer. This is where the real problem starts. Some do not even get a job for more than a year. Then somebody graduates, one who is far richer (and has spent more than $200,000) which will likely land a decent job. Leaving the other graduate still unemployed.

    Sucks, but it happens all the time.

  25. In that video, the girls says, “I just keep reminding myself that it’s not me, it’s the economy.” Really? She’s spending her time searching for jobs on the internet. I wonder if she’s considered taking her resume physically to places she wants to work? I wonder how many jobs she’s been offered but turned down because she’s expecting an “ideal” job just because she went to GWU. Unfortunately, there are so many young people with that attitude, and it’s the entitlement attitude that is keeping young people unemployed. Not the economy.

    1. We justify to make ourselves feel better. That said, if these stats of unemployment are even close, it’s hard to blame anyone. 52% unemployment for people 25 and under is unbelievable. There is something really wrong with the system.

    2. You are a pompous prick, and really, YOURE the one with the entitled attitude. You had NO problem getting a job right after school, so you cant even imagine why people like us are so lazy and stupid we cant get jobs. You must be really clueless. Its people like you that keep us OUT of the workforce and keep assholes like yourself IN it. We have a fucking right to be entitled. We did everything right to get to where we are, and it is a matter of LUCK (and bankers and bush) that we ended up in this situation. Ive tried for 2 years to get a job, with no luck. We have a right to be angry, a right to rebel, and a right to HATE people like you.

      1. Actually, I didn’t have a firm offer upon graduation, but ended up getting one 1.5 months afterward through tenacity.

        I welcome your hate! Keep it up. It might get you a job one day. But, in the meantime, trying volunteering. Best

      2. Well it sounds like all your complaining and entitlement and hate has done well for you so far. You should probably just keep doing what you’re doing, because it sounds like it’s working out really well for you.

        And I graduated in May of 2008. Don’t talk to me about bad timing.

        Hell, my girlfriend just quit a job in sales making $50k+ a year (with potential for well over $100k a year) and they are hiring every day. If you didn’t have such a bad attitude, I would give you the name of the company. You probably wouldn’t want the job anyway though, because it’s probably not perfect for you and YOU DESERVE PERFECT!!!!

  26. GW is ridiculous as you say. It’s no better than a lot of the state schools in the area or around the country. I went to a private college but had a full tuition scholarship. Thanks to the scholarship and my parents’ prudent savings I graduated with no debt.

    I feel like there are three modes that a prudent college education should take: state school, top tier school (like Princeton, Stanford, Harvard) or private school with major scholarships that you can keep all four years (bringing the cost to state-school levels). Paying big money for anything but the absolute best just doesn’t seem to pay off for educational expenses.

  27. I went to a UC and it was great. There is no way I would sign up for 200k of debt though. That 80% number seems unreal. I don’t interact with many new college grads so I don’t have a feel of how accurate it is. I thought companies are hiring again.

  28. Srinivas Rao


    I was lucky enough to go to a really good state school. But I still had to take out loans to pay for my education and that’s probably why I didn’t have nearly as much freedom in what I was doing post college as I would have liked. That being said you, you bring up some very spot on points in this article about things I wish I would have known or thought about back when I was making these decisions. I agree with you that spending 200k on a school that’s not Harvard is a bit ridiculous. The state of higher education is actually in real flux right now because I think more and more people are going to realize that it may not have the ROI they think it should.

    1. Berkeley is a great school and well worth the tuition. In fact, I’d choose Berkeley over 98% of all the private schools out there!

      Unfortunately, the State is broke and they want to raise tuition by another 30%!

  29. Oh my gosh, 200k in debt? I would be crying my head off.

    The problem I am seeing here with great public universities (specifically, University of Michigan) is they are accepting so many out of state (or country) students that the amount of kids from Michigan that can get in is dwindling. I think U of M is nearing 40 percent of out of state students, which is the limit for a public school as I understand it. So, some kids might chose private if the cannot get in to the ‘best’ public institution in the area.

    I know a lot of kids that do go to private colleges, but they have gotten huge scholarships. Most kids I know that went private are paying about as much in tuition as they would at U of M. The ones I know that don’t receive scholarships are from very wealthy families.

    It is scary how much tuition has gone up over the years. I will be facing all of that in just about a year, and it will be an interesting path we will be taking.

    1. I’m excited to follow your adventure with your kids! It’s totally logical for UoMichigan administrators to accept more out of state students, and less in state up to their covenant. With out of state students paying 3X more, they are necessary to make the school great for all!

      Sure, it sucks for instate students, but what can the college due if state education funding keeps going down?

  30. People gasp when they hear how expensive healthcare costs have gone up. But not many realize, cost of education has spiralled more than healthcare costs! Next big bubble in the making!

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