Unemployed College Grads Outnumber Unemployed Drop Outs

hanks to immigration and free trade, a college degree no longer will help you find a job.

In an economic first for the U.S., there are now more unemployed college graduates than there are unemployed high school dropouts, according to an analysis of Labor Department data by the Economic Policy Institute.

"The recent job market has been particularly tough for those workers with college degrees," said EPI economist Jared Bernstein. "[T]he number of unemployed college graduates surpassed that of high school dropouts a few months ago," he said in an "Economic Snapshot" report for March 17.

Corporate outsourcing played a part, but the major reason for what appears to be an upside-down trend in the labor market is immigration, according to ESR Research Economic Consultants in Indianapolis.

That's because immigrants are becoming an increasingly larger share of America's total college-educated workforce, said ESR President Edwin Rubenstein. He reported that between 2000 and 2002, the number of college-educated immigrants rose by 19.4 percent, while the number of college-educated native-born rose only 4.9 percent. The number of immigrants with college degrees jumped by 546,000 in 2002 alone, intensifying the competition for jobs among the college-educated.

"Many educated foreigners come here on student visas. Some 13 percent eventually obtain a 'green card'... Others stay here illegally," said Rubenstein. In addition, corporations are allowed to import immigrant workers under the federal government's "H-1B" program.

Such large numbers of college-educated immigrants flooding the domestic job market has affected workers' incomes, according to a study by the National Bureau for Economic Research in Cambridge, Massachusetts. Prof. George J. Borjas of the Kennedy School of Government at Harvard University, conducted the study. He found that current immigration levels depress American wage rates.

"The analysis indicates that immigration lowers the wage of competing workers: a 10 percent increase in [labor] supply reduces wages by 3 to 4 percent," he said.