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What’s the Unemployment Rate for College Grads 25 to 34 Years Old?

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Still have some concerns regarding the state of the economy? Here’s an intriguing question for you: what’s the unemployment rate for college grads ages 25 to 34?

    (A) 2.4%    (B) 5.8%    (C) 7.6%    (D) 9.5%

The answer is at the end of the blog.

Quoctrung Bui of the NYTimes analyzed responses to an open-ended question from a Google survey (only 14% accuracy) and a NYTimes survey of readers (13% accuracy). That’s a pretty low guess from a lot of sophisticated folk. The most common answers to the open-ended question were between 20 and 30 percent. The Times was so surprised that they revised the question and ran the survey again. They asked: The unemployment rate for 24-to-34 year olds-without a four year college degree is 7 percent. What do you think it is for 25-to-34 year-olds with a four year college degree?  That’s a superbly focused, open-ended polling question.

There’s some rather clear evidence that a college degree doesn’t guarantee a well-paying job. But not having a college degree is much worse. In a recession like the Great Depression, the gap between college grads and non-college grads widens to 10% favorability for college grads. And although college doesn’t guarantee a great income, grads typically can expect to make more a money than high school and non-college grads. A lot more money: more than  half a million over their life-time.

But Bui’s concluding paragraph contains the most significant conclusion: What’s remarkable is that this story has been unseated by  more emotional narrative. One that could be very costly to young people and society.

Daniel Kahneman, the Nobel Prize Winner, gets at this issue in his study of bias: When the handsome and confident speaker bounds onto the stage, for example, you can anticipate that the audience will judge his comments more favorably than he deserves.  One thing is clear in today’s politics and business worlds: we need to improve the ability to identify and understand errors of judgment and choice in others and eventually in ourselves. The fact of the matter is that water-cooler conversations have a lot of built-in error.

Using May 2016 numbers, the answer to the question is 2.4 percent. Yep, that’s right. College grads ages 25 to 34 have an unemployment rate of 2.4%.

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