Not all Italians have such a dismal result after four years of academic study, of course. Some graduates get good jobs and solid careers, but this young man’s observations reflected the experience of many of his generation. Consider this surprising commentary, which shows that it’s actually more difficult for Italians to get a job with a university degree than without one:
Italy is the European country with the lowest number of “tertiary” graduates—meaning anyone with a university or university-like degree. Yet despite relatively low supply, one in three tertiary graduates between 20 and 24 (33.3%, up from 27.1% in 2011) remains out of work, according to Eurostat—even higher than their peers with just a high-school level degree, whose unemployment rate is 30.4%.
Italian companies actually seem to favor workers with lower levels of education: 37% of those employed in managerial positions hold only the minimum compulsory level of education, compared with 15% who hold a bachelor’s degree or above, according to AlmaLaurea, an Italian institution run by a consortium of universities and the Ministry of Education that gathers statistics on education.[1]
The problem, it seems, is that Italian undergraduates favour the Humanities and the law, areas that are disconnected from the contemporary European economy. But give some thought to the Italian realities. One-third of graduates were without work in 2013, only a small proportion move into management positions, and only slightly more than half of those who start out to get a degree actually complete their studies. If this is not an educational crisis, it’s hard to know what would be.
New Realities: Unemployment and Underemployment
The Italian situation is a good example of two new global realities: university graduate unemployment and the equally important pattern of sustained underemployment. Unemployment is easily understood. Students graduate and head into the job market, only to receive a cold reception. They cannot find work, struggle with living costs, and often move back home. The highly anticipated launch into adulthood has been postponed. Underemployment is equally devastating, but a little different. Many university graduates do find work, but not of the type and with the income that they had been led to expect. This produces underemployment, where university graduates find jobs but in positions that do not require the skills and expertise learned in their academic studies. A political science student driving a bus is employed, certainly, and perhaps even reasonably well paid, but in terms of the utilization of his or her skills is clearly underemployed. So it is with the hundreds of thousands of university graduates employed as retail clerks, taxi drivers, office support staff, hotel or airline representatives, or otherwise doing decent and useful work, but work that they could easily have done immediately after leaving high school.
According to The Economist, graduate unemployment and underemployment are significant around the world.[2] In country after country, graduate underemployment has become commonplace. In China, even before the financial slowdown hit in 2015, the chaotically expanding university systems—founded on a firm belief in the Learning = Earning mantra—had gotten well out of sync with the national labour force. New graduates struggled to find work. Graduates returning with foreign degrees found the market potency of the diploma greatly diminished. It turns out that China’s manufacturing-based economy did not demand an endless supply of university graduates, even in such previously high-demand fields as engineering.
The situation is not the same everywhere. In countries that limit university enrolment, as in Germany and Scandinavia, where the skilled trades enjoy considerable status and decent incomes, graduate unemployment rates are significantly lower. The American situation, however, is stunning. In 2013, according to Richard Vedder and his colleagues with the Center for College Affordability and Productivity, 48 percent of college graduates were underemployed, and 37 percent of college graduates held positions that did not require a high school degree to perform the job properly. Collectively, that added up to five million American college graduates holding jobs across the country that did not require even a high school diploma, let alone a college degree. As they reported, ominously, “Past and projected future growth in college enrolments and the number of graduates exceeds the actual or projected growth in high-skilled jobs, explaining the development of the underemployment problem and its probable worsening in future years.”[3] The situation eased in the United States as the economy rebounded in 2015, but became worse across Europe and in many parts of Asia, particularly in China. The National Post reported that “students have high expectations that their university degrees will amount to a job fairly soon after graduation … To the statement ‘obtaining a post-secondary degree ensures I will have a job in my field of study after graduation,’ the average response was 4.5 out of 10—meaning about half of the students strongly felt their degree would fairly easily score them work.”[4]
So, what went wrong? How did the dream of a university education become so substantially disconnected from the reality? It is important to realize that the focus on the experiences of college and university graduates actually understates the problem significantly. Imagine, if you will, that a hospital reported the success rates of open-heart surgeries basing its data entirely on the health outcomes of those who walked out of the medical centres on their own within a few weeks of the operation. This would be absurd, of course, for it would exclude those who died or became sicker in the hospital after their operations and those who were not helped by the procedures. The statistics, obviously, would be a success story, skewed in favour of the hospitals and their medical professionals.
But universities do this all the time. Statistical reports, particularly those issued by universities or academic associations, routinely focus on university graduates—the ones who enrol and then continue through to the end of their programs, graduating as planned. These are the patients who walked out of the hospital on their own, in other words. But what about those who fall by the wayside? In the United States, over half of those who start a college or university program do not complete their degrees within seven years. And the dropout statistics vary according to institution and race: the rate is much lower for Harvard and much higher for two- and four-year community colleges. “Traditionally Black colleges” in the USA have a six-year graduation rate of only 39 percent.[5] David Leonhardt, writing in the New York Times on September 9, 2009, reports that “only 33 percent of the freshmen who enter the University of Massachusetts, Boston, graduate within six years. Less than 41 percent graduate from the University of Montana, and 44 percent from the University of New Mexico. The economist Mark Schneider refers to colleges with such dropout rates as ‘failure factories’ and they are the norm.” If universities are going to take credit for the employment outcomes of their graduates, then surely they should also be morally responsible for students who are admitted into programs of study but drop out for academic, financial, or personal reasons.
Educational Outcomes
Educational outcomes vary widely across and within countries. Canadian universities do better than those in the United States, on average, although approximately 30 percent of Canadian first-year students do not graduate. At India’s highly regarded IITs, dropout rates are low, as they are in most elite universities. High-quality institutions, like Hong Kong Polytech, Cambridge, Stanford, and Swarthmore, have very low (as in less than 10 percent) dropout rates after admission. There is a simple lesson here. If you are juggling statistics to favour universities, you should select smart, highly motivated, and hard-working students at high-end institutions. Then graduation outcomes and employment outcomes will certainly tend to make the system look good.
At the other end of the spectrum lie America’s open-entry institutions, where graduation rates are routinely under half and occasionally lower than one-quarter of all entrants. In northern Europe