As the glow of graduation dims‚ newly-minted professionals are coming face-to-face with the harsh realities of a still-struggling economy and the fact that their degree might not be as valuable as they’d hoped.
Our Los Angeles bankruptcy attorneys have learned that over the last several years‚ the number of college graduates who are working in fields that don’t require a college degree has risen steadily.
Economists call this “mal-employment.” As of today‚ it has reached 36.7 percent – more than one-third – for college-educated employees below the age of 25. That’s according to research conducted by the director at the Center for Labor Market Studies at Northeastern University.
Compare that to recent year mal-employment figures:
- 2007 – 27.4 percent
- 2008 – 30.3 percent
- 2009 – 31.4 percent
- 2010 – 32 percent
- 2011 – 34.3 percent
- 2012 – 37 percent
One might take comfort in the fact that it’s dipped slightly over the last 12 months‚ but the reality is the amount is negligible – .03 percent.
The end result of this is that we have people who are educated and qualified to embark on careers as attorneys‚ teachers‚ journalists or executives. Instead‚ they are working as bartenders‚ retail clerks and construction laborers.
Now‚ there is nothing wrong with the latter career fields‚ but it’s not the reason these individuals went to school. The paychecks are almost certainly not what these individuals expected to earn‚ especially now that they are burdened with the added cost of having to repay student loans‚ with interest rates doubling as of July 1.
Researchers say mal-employed workers earn about 40 percent less each week than their peers. That’s significant. It also impacts those workers with a high school education‚ as employers are more likely to snap up workers with a college degree over someone with one‚ even if they don’t plan on paying them anymore for their advanced education.
For people in this scenario‚ it becomes very easy to rack up credit card debt or other forms of debt. There is almost no opportunity to save for emergencies‚ and most are living paycheck-to-paycheck‚ barely able to cover those student loan bills.
This is where the lawyers at our firm would recommend consideration of bankruptcy. It may not seem ideal at the outset of your career and it’s true that it won’t allow you to purge your student loans. However‚ such a move will give you the opportunity to unshackle yourself from almost all of your other debts. This can make the prospect of covering those student loan bills far less daunting and can speed your assent to sound financial footing.
The other thing this may allow you to do is to take on an unpaid internship or some low-paying position in your career field of choice – something to help you get your foot in the door. Seizing such an opportunity might not be possible if you are on the hook for mountains of debt for which you couldn’t afford to fall behind. At least with your student loans‚ you can seek a temporary deferment. Ultimately‚ the hope is this could lead to a better-paying job in your chosen profession.
If you are contemplating bankruptcy in Los Angeles‚ contact Cal West Law to schedule your free consultation. Call (800) 568-0707.
Recent college grads face 36% ‘mal-employment’ rate‚ June 25‚ 2013‚ By Tami Luhby‚ CNN Money