ic S/general/checkmark circled Thanks for subscribing! Be on the lookout for our next newsletter.
ic S/general/checkmark circled Saved to Favorites.
Articles / Applying to College / College Grads' Starting Salaries Down 10%

March 8, 2012

College Grads' Starting Salaries Down 10%

College Grads' Starting Salaries Down 10%

When our son graduated from college back in 1999, he had a basket full of extremely attractive job offers. In fact, the real problem was deciding which city he wanted to live in. The offers were mainly the same as far as money and perks went. Of course, this was at the height of the dot-com bubble and our son was a combo computer-electrical engineer, so the good times were rolling. It was an exciting time for college grads. What a difference a decade or so makes.

The statistics today aren't nearly so cheery. As a story in Consumerist.com com states, "To the graduating class of 2012: All that money you or your parents have spent or borrowed to pay your tuition for the past few years? It's not getting the same return on investment it did a decade ago." That's quite unfortunate because of the quadruple whammy of recession's effect on job availability, a decade's worth of inflation since the dot-com bubble, skyrocketing college costs, and the downturn in starting salaries. When you add up the cumulative effect of these four factors, you get a rather grim prospectus.



Once again, we're reminded of that phrase "Return on Investment (ROI)," which also has to include the raging storm of student loan debt, which, nationally, exceeds the total of both credit card and auto loan debt, perhaps eventually eclipsing mortgage debt, too, some day. It's not a pleasant prospect.

Let's take a look at some numbers about starting salaries, courtesy of Consumerist. com and the Wall Street Journal.

Recent College Graduates Making 8-11% Less Than They Did 10 Years Ago

To the graduating class of 2012: All that money you or your parents have spent or borrowed to pay your tuition for the past few years? It's not getting the same return on investment it did a decade ago.

According to the folks at the Economic Policy Institute, the average inflation-adjusted wage for male college graduates aged 23 to 29 was $21.68/hour. That's an 11% over decline over the last ten years. And while wages for females in the same age and education group are only down 7.6% during that same time period, women still make significantly less on average ($18.80/hour).

As for those people who choose to go straight from high school into the workforce, the average wage for males aged 19-25 dropped 10% to $11.68/hour. Females in this age and education group saw a similar drop of 9.2% to $9.92/hour.

Overall, average hourly wages have increased over the last decade, but that stat could be misleading, as a large number of low-income workers are now out of a job and thus not figured into the average wage.

And, points out the Wall Street Journal, while employers tend to not cut pay of long-time employees, they make up for the lack of pay cuts by offering less cash to new hires.

The Journal notes:

Young Adults See Their Pay Decline

Young people entering the job market are taking the brunt of the downward pressure on wages caused by high unemployment, according to a new analysis of pay trends.

In data compiled for a coming report, the Economic Policy Institute, a center-left think tank in Washington, found that the average inflation-adjusted hourly wage for male college graduates aged 23 to 29 dropped 11% over the past decade to $21.68 in 2011. For female college graduates of the same age, the average wage is down 7.6% to $18.80. ...

***

The comments follwing each of these articles are certainly worth reading, for a sampling of thought from both current new hires and parents. Also, check the corresponding thread on the College Confidential discussion forum for more insights. By all means, feel free to add your own.

**********

Be sure to check out all my college-related articles and book reviews at College Confidential.

Written by

Dave Berry

Dave Berry

Dave is co-founder of College Confidential and College Karma Consulting, co-author of America's Elite Colleges: The Smart Buyer's Guide to the Ivy League and Other Top Schools, and has over 30 years of experience helping high schoolers gain admission to Ivy League and other ultra-selective schools. He is an expert in the areas application strategies, stats evaluation, college matching, student profile marketing, essays, personality and temperament assessments and web-based admissions counseling. Dave is a graduate of The Pennsylvania State University and has won national awards for his writing on higher education issues, marketing campaigns and communications programs. He brings this expertise to the discipline of college admissions and his role as a student advocate. His College Quest newspaper page won the Newspaper Association of America's Program Excellence Award, the Pennsylvania Newspaper Publisher's Association Newspapers in Education Award, the Thomson Newspapers President's Award for Marketing Excellence and the Inland Press Association-University of Kentucky School of Journalism and Mass Communications Inland Innovation Award for the Best New Page. His pioneering journalism program for teenagers, PRO-TEENS, also received national media attention. In addition, Dave won the Newspaper Association of America's Program Excellence Award for Celebrate Diversity!, a program teaching junior high school students about issues of tolerance. His College Knowledge question-and-answer columns have been published in newspapers throughout the United States. Dave loves Corvettes, classical music, computers, and miniature dachshunds. He and his wife Sharon have a daughter, son and four grandchildren.

More on Applying to College

Can I Reapply After Early Decision or Early Action Rejection?

Can I Reapply After Early Decision or Early Action Rejection?

Question: If I apply to a college through Early Decision or Early Action, but I am not accepted, can I apply again through Regula…

Advantages of EARLY Early-Decision Application?

Advantages of EARLY Early-Decision Application?

Question: I'm applying Early Decision to an Ivy League school. Is there any advantage for me to send in the application mate…

Can I Apply Early Twice?

Can I Apply Early Twice?

Question: I am planning on applying early decision to my first-choice college. I will be notified of my status by December 31st. …

Early Decision or Early Action?

Early Decision or Early Action?

Question: Why should I consider an Early Decision or Early Action college application? What's the difference?

Your level of d…

brett-jordan-POMpXtcVYHo-unsplash.jpg

3 Steps To Writing a Strong College Essay

You brew a cup of coffee, you fire up the old laptop, you take a deep breath and focus your mind on the wealth of significant and…

A-Z College Forums

Browse the College Forums
C1E9D4E7-C4C9-4B28-8946-8F441A6D62B3

Find Your Best Fit

Find your best fit college and track your favorite colleges.