Young College Grads in Free Fall

Posted by: Michael Mandel on August 29

Today’s income release from Census was filled with all sorts of interesting numbers. Real median household income rose for the first time since 1999. But it turns out that all of the gain came from foreign-born households—immigrants in other words. The income of native households remained “statistically unchanged.” That will give both the pro-immigrant and anti-immigrant forces plenty to talk about.

More disturbingly, the numbers show that young college grads face a steadily worsening future of falling wages. The real earnings of workers aged 25-34 with a BA dropped by 3.3% in 2005. All told, the earnings of young college grads are down by almost 8% since 2002.

Isn’t this a horrible looking graph?


TrackBack URL for this entry:

Reader Comments


August 29, 2006 03:31 PM

As someone in that age group, I am actually not worried (admittedly, my nominal income has tripled since 1998 (age 24) to today (age 32)). Here's why I'm not worried :

1) Half of the world's people have joined the global labor force in the last decade (India, China, former USSR). While this will/has cause(d) a massive one-time shock, it can only happen once. There just aren't very many well-educated people left to join the global work force (Africa and the Islamic world don't have anything to offer the way India, China, and Russia do). We are weathering this massive adjustment of the world's economic tectonic plates with moderate, but not huge, shocks. If we get past this (which we almost have - see item 2)), no similar new addition to the global labor pool exists.

2) In India's IT sector, salary increases of 14-18% a year are typical, due to labor shortages. Even their vast labor pool is saturating, and their cost advantage relative to the US is narrowing. Apple pulled out of India to go Pakistan, but even that wage advantage cannot last long (Pakistan has a lot fewer engineers to begin with).

3) Thus, the only thing that really matters is the productivity growth rate (which was revised downward, but is still strong). As long as that is strong, salaries will bounce back once equilibrium is reached again w.r.t. global labor pools.

4) Surely Europe is affected even more adversely than we are.

5) Taking 2000 as the top of the chart means that salary expectations are set in the dot-com bubble era. They should not be. A chart should date back to 1995 to get a more accurate picture.

Brandon W

August 29, 2006 03:54 PM

As I pointed out from the article by David H. Autor, Lawrence F. Katz, and Melissa S. Kearney, there is a "'polarization' of the U.S. labor market, with employment polarizing into high-wage and low-wage jobs at the expense of middle-wage work". It seems to me that most college grads with Bachelor's degrees will find that their entry level jobs are rapidly paying less with this polarization. I've also mentioned the Fortune magazine article that discussed the "Grey Ceiling" of baby boomers that are keeping college grads from advancing; thus, limiting their income growth potential. But increasingly flatter organizations (we're definitely in my territory now) may mean those job promotions never come. When those boomers finally retire the job responsibilities may simply be spread out among positions within the organization - most likely without a commensurate increase in pay ("it's just part of your new job description...").

I know I come off as the resident pessimist, but I don't think I've made any leaps of logic. I believe this is merely the reality we face going forward. This *is* the "new economy".

Brandon W

August 29, 2006 04:12 PM

It's great that your income has tripled, but that's only anecdotal evidence (for which you have repeatedly attacked me). Even when the numbers don't go your way, you still have to acknowledge them. I absolutely agree that the introduction of China and India to the global economy has been a significant factor in the declining wages, but I disagree that we're very close to the end of that influx and its effects. 90% of the population is being choked off and that's just the way it's going to be. I think anyone who isn't prepared for a *very* different socioeconomic world - especially in the U.S. - in the next 20-30 years is in for a huge shock.


August 29, 2006 04:42 PM


I did not use my example as one of my 5 points in this argument, so don't claim that I did.

You have not addressed the 5 points. While I do agree that the entrance of so many people into the labor pool would naturally cause shocks, I still maintain that 1) the worst is behind us - those who have not been outsourced by now, particularly in IT, probably will not be - the easy oursourcing has already been done 2) this is a one-time event, as there are almost no large countries with many college graduates left that are yet to join a globalized labor pool 3) wages in India and elsewhere are rising so fast, due to shortages even there, that their cost advantage is diminishing, 4) Europe, with higher wages per hour, will suffer more than the US, and 5) if one sets their salary expectations based on the dot-com bubble, they should not be surprised to not see that again.

You have to refute all of these points.


August 29, 2006 05:04 PM

Young(er) college grads are also more likely to carry debt at levels that are much higher than previous generations. Financially speaking - wages, debt, cost of services (like healthcare) and cost of housing - people born in the 1970s and 1980s are caught in a perfect storm of bad news.

Kartik, comparing jobs and salaries with India is non-sensical, especially with recent reports showing wages in the U.S. loosing their correlation with productivity. To offer real perspective, the "chart" should date back 100 years (not 10). It should track debt to income ratios; it should reflect cost of living to income ratios. Present day young Americans would chart very poorly on these.


August 29, 2006 06:26 PM

"1) the worst is behind us - those who have not been outsourced by now, particularly in IT, probably will not be - the easy oursourcing has already been done."

True. Further, not only is demand diminishing, but supply is diminishing. India is so full to the rim with outsourcing that it is beginning to do some outsourcing of its own! Sounds like the adjustment phase before the calm.


August 29, 2006 08:05 PM


If college grad salaries are depressing because of jobs of their skill level getting outsourced, how is it nonsensical to notice that the salaries in India are rising rapidly due to shortage, indicating that the Indian labor pool is saturating? Then college grads in the US might have light at the end of the tunnel.

That seems to be quite the crux of the issue.


August 29, 2006 10:23 PM

No doubt it's them psychology majors bringing down the averages...


August 30, 2006 01:29 AM

I guess they need more education. Perhaps we should start a post-graduate university. ;-)

Of course everything will work out, but will we be alive when they do?

Brandon W

August 30, 2006 08:33 AM

Kartik, I did address your points generally, rather than specifically. I'll attempt to address your points specifically for your sake.

"1) the worst is behind us - those who have not been outsourced by now, particularly in IT, probably will not be - the easy oursourcing has already been done"
-- There are hoards of administrative workers that could easily be outsourced, sucking away many of the entry-level jobs. Accounting and finance jobs could easily be done in China or India (numbers are the same everywhere). The global economy is increasingly based on information processing, and there's no reason they have to do it in the U.S. You underestimate the ability of investors and corporations to locate more productive options.

"2) this is a one-time event, as there are almost no large countries with many college graduates left that are yet to join a globalized labor pool"
-- Perhaps this is a one-time event; but it's one that's far from over. You speak as if the game is already over, when it's only halfway through the first quarter (the Asian Tigers have the ball on their own 35).

"3) wages in India and elsewhere are rising so
fast, due to shortages even there, that their cost advantage is diminishing"
-- They are still quite a bit cheaper in a number of ways. But you also assume that their only advantage is price. SE Asia is pumping out engineers and mathematicians at a rate far exceeding the U.S. These aren't factory workers or IT call-center people. You ignore the enormous advantage they are gaining in these areas which may well result in jobs for Americans holding MBAs and engineering degrees going to SE Asia. It's already happening and we're just getting started. SE Asia doesn't have to win on price alone.

"4) Europe, with higher wages per hour, will suffer more than the US"
-- Potentially, though not necessarily. Nevertheless, this is irrelevant to the discussion.

"5) if one sets their salary expectations based on the dot-com bubble, they should not be surprised to not see that again"
-- I might agree with this. Yariv is correct that a longer-term chart would be useful. I would say that one going back to 1945 would be the most useful. The world underwent a major economic shift from WWII and the U.S.'s place in it changed dramatically; going back to 1945 would show how things have fared in the "modern" economy.

I hope you feel I've addressed your points more specifically now.


August 30, 2006 10:22 AM


You say that the crux of the issue is jobs/salaries - and here lies our core disagreement. Jobs and salaries are only one element of living-affordability. Other issues include cost of goods and services (gas, heat, health, etc.), cost of education (from universities to pianno lessons), cost of housing (both renting and buying), etc.

While comparing US labor to that of India is interesting, it really only captures a fraction of the larger picture. Clearly, when there's a demand fluctuation for a specific job function, cost (i.e. salaries) for that job will rise and fall accordingly. And today, that happens on a global scale. That observation, alas, does not explain why things are SO bad for young Americans right now. Nor does it offer real relief if things level out.

The US has transitioned from a manufacturing economy to a knowledge economy (the "bleeching" of the American workforce), which had dire outcomes for blue collar employees. While salaries stagnated or fell, other costs rose dramatically, and without proportion. In the 1970s, a family could live a lower middle class life on the salary of one high school grad (think Archie Bunker as the classic example of that). Today, that same lifestyle requires two college grads.

When you look at all of these other costs (education, housing, etc.), we get a much more complex, and much more bleak picture of young American labor. Unfortunately, the answer to these issues is not global economics, but rather local politics: livable wage legislation, unions, federal grants for education, rent control, etc.


August 30, 2006 10:43 AM

The new economy is defined by information, not by location. Increasingly, a college degree does not mean much in practical terms (ie. an automatic junior exec. position). Entrepreneurship and understanding how to find your niche is how many grads will survive and prosper.
The difference between the U.S. market and the West European and Asian markets is entering college students in the United States are totally responsible for the costs of their education. This coupled with the "degree boom" that has occurred in the last 10 years, the skyrocketing costs of higher education, and the change from the 4 year degree to the "6 year" etc., all weigh heavily on new graduates. Saddled with this historic level of debt, the new grads enter the market only to find that those entry-level positions, which have not been outsourced tend pay far less then 5 years prior.
In addition, companies are under less and less obligation to provide benefits and wage increases, and the new grads are afraid to demand these things for fear that the company will simply pack up and leave of Asia or East Europe. These internal and external pressures have forced the gap between the ‘have’ and ‘have nots’ to become a gulf.
The only way that new grads will be able to survive is to make it big with a start up (ie. Myspace, Digg), or live with family, struggle with debt and ride out the storm.


August 30, 2006 02:33 PM


OK, we're getting somewhere.

1) and 2) : I think the low-hanging fruits for outsourcing have already been picked. It's been 4-5 years, and service jobs that could be easily outsourced have been. Why would they not be until now?

It is not a zero-sum game. The number of engineers in the world has doubled every 20 years. If it doubles again, there will be shortages across the board in India, China, and the US. Plus, more consumers in India buy US-brands of consumer goods, creating jobs in America.

3) The wage rise is significant if it continues for 2-3 more years. India itself is already outsourcing to Pakistan and Bangladesh, which themselves don't have such a large educated labor pool. Shrinkage in the cost delta makes outsourcing less compelling, which is why I think the worst is behind us. I am Indian, and I can tell you that the supposedly vast Indian labor market is already tapped out, with raises of 14-18% a year typical.

4) Europe does matter, because it means the population of developed countries that have opportunities for outsourcing is larger than just the US. US + the EU is too big to just be hollowed out to India.

The worst is behind us, and 3 years from now, people will still be worrying about 'outsourcing' as a political strawman, despite no evidence of the big sucking sound of jobs leaving America.

Kay Stoner

August 30, 2006 03:03 PM

I have to dissent on a number of points: First, that in a new economy defined by information, a college degree does not mean much. In fact, college degrees and "qualifications" count for very much to hiring folks, who are trying to sort through the thousands upon thousands of job applicants, looking for the "right" fit. They rely increasingly on an academic vetting process to determine who is ready and who isn't for the job market.

That, I believe, is what we're seeing in the technology job market, as folks who show up for work (from various corners of the globe) have degrees which supposedly qualify them. Sadly, in some cases, academic qualifications don't suffice to replace practical knowledge. (
And in some cases, their CV's are faked (see

But I do agree that entrepreneurship can be a much "safer bet" than a college degree. For those willing and able to stay abreast of the latest technology developments, and who can learn to use them well, there's a great future, whether you have a degree or not. In fact, not having a degree can give you an edge in some high tech areas. In the case that you got in on the ground floor of fundamental technologies, and you've kept up your skills quicker and more thoroughly than fresh grads (if you've been using the technologies since before someone figured out how to create a course about them), you stand an excellent chance of pulling ahead of the crowd and doing well for yourself.

College degrees are nice to have, and they can be handy insurance. But they're no guarantee of a good and steadily increasing income. There are other inventive ways to get ahead in the world, and folks should consider them all.

If nothing else, learning to code while you're getting your history degree helps round out your professional profile. And it may pull you out of the credit-card debt fire when you graduate.


August 30, 2006 03:10 PM

Consider these latest citizen/consumer indicators if they were directed towards corporate America - there would be sirens going off. Every statistic is pointed downward and the political and business response is: "Hang in there, relief is around the corner." Would any of you be able to sell a presentation to your bosses if that was your pitch? You'd be shown the door.

Where's the economic ROI for the middle-class in the next 1-3 years? When will China and India start buying our products? How about a decent salary raise that is ahead of inlation?

Reminder: Consumer spending is 2/3rd's of the economy (stupid)! Kill the Consumer and you've killed the Goose that's laying the golden eggs.

A solution would be to have trade/tax/economic policies that benefit the middle-class. Period. That's the tide that will lift all boats. Especially those within the 20-30 age group.

camille roy

August 30, 2006 04:57 PM

The estimates I've read as to how long it will take the global economy to 'digest' a doubling of the workforce run a minimum of 20 more years. My specific refs, but I've gotten that from reading Xie and Roach at morgan stanley. Try plugging that into wage declines of 2% per year.

I think it's laughable that 'the worst is behind us'.

I think it's amazing how people identify with globalization, even as its destroying their livelihoods and economic futures. This country has become such a bunch of CEO bootlickers.

Dr. Dan

August 30, 2006 05:53 PM


Are you suggesting that the worst is behind US and you are going to see real wages increase from now on for skilled workers ?


"wages in India and elsewhere are rising so

The marginal product of a unit of capital has a BIG difference to be washed away this soon, son.

THE FACT IS : India will produce as many workers as US wants. It has the potential to take away all the jobs from US.

Please realise that IBM is investing 6 bn$ over next year and probably going to pour in more.

If IBM is doing this, I am sure every other Tech Industry will do the same.

In few years, we will surely see many indian IT firms in the fortune 500 list displacing many US firms.

Karthik will probably keep saying the same stories till then ?

Dr. Dan

August 30, 2006 06:02 PM


Don't be so hopeful. With US economy heading for a recession, you wouldnt need so many service folks from India to work for US.

I guess Pakistan will do nicely for you.

Please look at todays GDPs numbers :-)


August 31, 2006 02:57 PM

Dr. Dan and Camille,

You both are trying to find too many reasons to be pessimistic. This is probably why :

Anyway, India's IT workforce is already saturating. Out of a billion people in India, 40% are still illiterate. Only 3% have a PC at home, and of the 250,000 engineers a year they produce, only about 40,000 a year are actually competitive.

So you think the vast US economy will be hollowed out because India produces 40,000 engineers a year? Ha ha.

And don't tell me that you know better. You certainly do not. I know about 300 people in India, and have lived there. You probably never thought about India as an economic force until 2001. Now you think 'it can take away all US jobs'. Hilarious.


Hey, my wages have been rising a lot, right here in Silicon Valley. Globalization is a good thing, as it readjusts compensation relative to actual value produced.


August 31, 2006 06:07 PM

The more you post, the more stupid you sound...

Its hard to believe that you were living in India. I assume you were living under the rocks secluded.

You say,

"250,000 engineers a year they produce, only about 40,000 a year are actually competitive"

We know that 40,000 are added by two companies alone in 2006.. ie. TCS and Infosys.

Now similar numbers are added by Satyam, CTS, IBM, Accenture, CMC, HCL etc.

So your 40K number is WAY OFF the mark is proved !!

Coming to your 250,000 figure.

We know that there are 200 engineering colleges EACH in Andhra and Tamilnadu. Its estimated for our NBER paper that these TWO STATES themselves can produce 150,000 engineers in FY07. (not saying all are employable)

These are just engineering grads.

The are other colleges for Science and humanities studies.

Please could your ring your friends and update yourself improve yourself ?

David Foster

August 31, 2006 07:51 PM

I think it was some guy named Mike Mandel who pointed out, a couple of years ago, that college degrees had been paying above-market rates of return for a long period of time, and that such a situation was unlikely to last indefinitely.

Brandon W

September 1, 2006 12:41 AM

I've spent some time in Silicon Valley. If you think that area resembles anything anywhere else in the U.S., you're very foolish. There are reasons it costs $800,000 for a pretty mediocre house there; that entire metro is completely out of touch with reality. Also, you say that you're Indian. My experience is that only an elite group of Indians are working here in the U.S., and if you're one of them you're here because our country has failed to educate enough competent engineers (proving my point that the U.S. is falling behind) and you have no perspective on what the rest of the country is like. I know how this all sounds.... but it's true that your perspective is enormously skewed by the little sliver of the U.S. that you live in and the world in which you operate. That's fine; congratulations. But you should be aware of it.


September 1, 2006 01:57 PM


Many, many wrong assumptions.

I grew up in Ohio, and was born in the US (but I lived in India for many years). I know about the cost delta between Silicon Valley and the midwest.

I m certainly not an 'elite Indian'. I paid my own way through college, and my parents were not rich at all. This is true of most Indians in America. The rich ones don't come here at all.

Plus, your belief that the job market is weak would apply more to Silicon Valley than elsewhere. That SV is booming disproves your unsubstantiated opinions on 'outsourcing' even more.

All your points have been refuted.


September 1, 2006 02:06 PM

Dr. Dan,

Your rudeness on an *economic* blog is evidence of your near-religious obsession with this issue, and your bigotry/racism towards Indians. If that is what you are, then yes, we Indians will take your job away, because we deserve it more than you do.

Before 2001, all you knew about India was snakecharmers, elephants, Mother Teresa, and the Taj Mahal. Now, miraculously, you think that India will dominate the whole world economy. That is idiotic, but you deserve to lsoe sleep over this.

The 40,000 'engineers' added by Infosys, TCS, and Wipro include technicians. Only 10,000 are what would be considered engineers in the US. The 250,000 a year are really only 40,000 that would be considered 'engineers' in the US.

Your own economic pessimism is the reason you are failing in this booming economy (due to negativity, risk aversion, paranoia), while others are succeeding.

This article explains the psychology of people like you :

And this article explains why your type is perenially unhappy :

Go hide, Dr. Dan, the brown people are coming to enslave you!!!

Brandon W

September 1, 2006 03:21 PM

Kartik, my irritation with your reality disconnect may have lead me to make assumptions I shouldn't have, but you're still worshipping a false god by kneeling before the ridiculous numbers coming out of the government and the dead fish on Wall St. You are quite self-righteous, self-indulgent, and self-important, and impossibly self-assured of your correctness in everything economic (and I can safely presume everything else). I do know your type. I may be wrong about a lot of things, and I'm willing to acknowledge that, but I know I'm not wrong about where this country is going socioeconomically. The world won't end, the country won't collapse, but given your adoration of the economy as-it-is I know you have no understanding of where we are going and I know which side of the great divide you'll be on.

Brandon W

September 1, 2006 04:07 PM

Kartik, Mike, et al...
Here's another reason why the reported inflation is highly faulty (which, of course, makes so many other "real" numbers equally incorrect), as well as more evidence as to why the numbers aren't connecting with reality:


September 5, 2006 11:29 AM

Hi Mike,

I'm plowing through the census release and am not finding the stats showing young college grads experiencing an income drop - can you please point me to where in the report you got this stat from?

Many thanks


September 5, 2006 02:27 PM


Your personal attacks, simply due to not being able to refute my economic arguments, are disappointing. You make false assumptions about me to make yourself feel better, and when those turn out to be false, you are frustrated.

But consider that your attitude (one of pessimsm, entitlement, and possible xenophobia) is the reason for your lack of economic success, in an economy where just about every metric is stronger than the long-term averages.

Don't be a fair-weather free-marketer. If you support free markets, that means you are prepared to adapt to them without complaining. Don't believe that you are 'entitled' to something that people in India are not. Don't get terrified just because you hear about a new engineering college in India that will produce 400 new engineers, or that China bought 10 million new cellphones.

Get up, be an American, and compete.

Mike Mandel

September 5, 2006 05:05 PM

Just a note to everyone to please avoid personal attacks, and stick to the issues (which are incendiary enough).

Thanks much

P.S. Yariv, I calculated these figures myself, based on the detailed online data tables . For example, the data for 2005 comes from the table


September 6, 2006 12:13 PM

Hi Mike,
we're pulling stats from the same place, but I'm seeing an increase in median income for full time young employees with a BA decline:

2002: $41,361 (link:

2003: $41,800 (link;

2004: $42,087 (link:

2005: $43,143 (link:


September 6, 2006 12:13 PM

Hi Mike,
we're pulling stats from the same place, but I'm seeing an increase in median income for full time young employees with a BA decline:

2002: $41,361 (link:

2003: $41,800 (link;

2004: $42,087 (link:

2005: $43,143 (link:

Mike Mandel

September 6, 2006 02:31 PM


You are using the 25 and over data, not the 25-34 numbers.

Brandon W

September 6, 2006 04:59 PM

Kartik, I note you still did not acknowledge my point about the faulty numbers, including my reference to an article which gives you the details you so desire:

I would enjoy hearing some genuine feedback after you have - you know - actually read the article.


November 20, 2006 10:06 PM

I'm not a professional and i know this conversation ended september 6, but I graduated from the university of delaware in may of 2004 with a bachelors in political science. I just found my first real job about a month ago. I make $32,500 a year with no benefits, and I consider myself lucky! There are a lot, and I mean a lot of people who were in my situation. They have college degrees from good universities and are working as waiters, delivery drivers, and barnes and noble because they can't get hired. Someone said be an American and compete, I agree with that, and we did compete...we worked hard, studied hard, and took risks by taking student loans to invest in college and our futures. For over 2 years, I checked monster/ny times want ads/america's job bank and with every resume sent out I either received no response or a "you don't meet our qualifications at this time." I can't tell you what the numbers mean, but I can tell you about the realities of some of the younger people i know who are really struggling..good people, not slackers.

jon h

March 29, 2007 06:37 PM

well, as someone who graduated in December of 2006, there was definately no New Years Celebration! I have been unemployed ever since, and income has been 0 dollars. I actually, am not in that age group, least i won't be until 2008.

jon h

March 29, 2007 06:40 PM

okay brandon, i can relate to your story. "horrified by it", but can relate. i graduated in December, with a degree in Airline Management.....and have not even been able to get hired as a bag handler! I even thought about, leaving the industry altogether just to pay bills.

I will admit however, that I was not the perfect student, and DEFINATELY did not go to the perfect college! However, I still willing to scramble for whatever i can get to pay bills. Any suggestions?

Brandon W

March 30, 2007 09:01 AM

I'm sorry to hear about your difficulties; though, this is what we get in global Free Market(tm) capitalism. Just some tips that may be helpful (and may not):

1. The best jobs come from networking. Quit worrying about applying everywhere and start schmoozing.

2. If you're absolutely in a pinch and want to stay with transportation, call up Enterprise Rent-a-Car and ask about their management training program.

3. Start thinking about how to run your own business in the future. Always remember that capitalism favors capitalists. Real capitalists control capital; everyone-else are their laborers. Start planning to be a capitalist.


July 6, 2007 11:21 PM

1) It would be much more useful to see earnings diesaggreated by major.

2) Non-technical non-math related liberal arts majors tend not to be particularly good preparation for the workwolrd - especially in the absence of related work experience

3) I wonder how much of this has to do with more people going from college. High school grad wages went to hell at least partially because any moron can get a diploma and the more talented tend on average to have at least some college(and also because they got outsourced long ago - an American high school grad's factory job can easily be replaced by an Indonesian with an 8th grade education). I wonder whether the same is happening for college grads - if so, it would be interesting to see whether such students are congregating in easier majors/taking longer(if standards are being maintained) or spread evenly across all majors(which might imply lower standards).

4) Alternatively, some people who take longer to graduate would have less work experience and hence, lower wages.

5) I agree that a longer term graph would give a better persective.

To any college student out there: The three things employers care most about are your communication abilities, your major, and your work experience. GPA is less important, where you went to school even less important.


July 10, 2007 11:30 PM

Kartik (if you are still reading this):

You make some good points, but your data may be off. My best coworker is Indian, and I know that even with higher levels of experience, foreign workers make substantially less than comparable American employees. I believe this is becuase with their visa types they have limited options. I realize that you are a citizen, but assuming that you started out at 40k and tripled to 120k, or 150k, that's still not *that* good out in Silicon valley, where the average house costs $600k on the low end. With that salary, you would be better off living in St. Louis making $85k and buying a $160k house. So we're not exactly comparing apples to apples.

India and the ability to acquire H1B visas DOES create hardships on American employees. Major employers do look to hire cheaper (Indian) labor, but right now the market is so tight than they really have no alternative. Plus, I've worked with all nationalities, and I'd rather work side by side with Indians than my own countrymen. Why? They actually want to do work and study, while (and I know I'm stretching a generalization) the Americans I work with are more interested in acquiring SUVs, etc, baseball practice, pretty much everything except work. Also there is a strong sense of entitlement I've noticed where the Indians seem to be happy to be working and drawing a paycheck.

Looking back on my own experience, I feel stuck by the curve that Dr. Mandel pointed out, but at the same time it's well within my control but I choose to do nothing about it at the present time. My income has risen about 65% from my first post college job seven years ago. It could easily be double if I really pushed the envelope, but that would require a move.

Within 10 years the only differentiator will be a post-graduate degree. undergrad degrees are getting to be a dime a dozen, and with the proliferation of correspondence schools, web programs, and other diploma mills, the bachelors' has really lost a lot of it's clout.

Richard A.

November 26, 2007 11:21 AM

Computer science majors have among the fastest falling wages compared to other college grads. This of course has been brought about by the massive H-1b flood under Bush.


November 26, 2007 02:30 PM

Posted by: Kartik:

"3) Thus, the only thing that really matters is the productivity growth rate (which was revised downward, but is still strong). As long as that is strong, salaries will bounce back once equilibrium is reached again w.r.t. global labor pools."

Last I heard, wages have been been lagging productivity growth by a lot, for most workers in the US, for a few decades now.

Joe Mescher

February 25, 2008 09:36 PM

How to succeed after college was and is the first thing on my mind after graduating from Michigan State in 2004.

Everyone has to sell their skills in a competitive workforce. That's not an easy skill for people new to the workforce.

Reading BusinessWeek is a great resource for learning about the competitive environment. How to learn the skills needed to survive in it is the subject of my blog for college grads:

Thinking and believing you will succeed is step one!


May 6, 2009 09:45 PM

Falling wages are just part of our failing economy that seems to worsen, regardless of what is being done to fix it. This is because the system works opposite the laws of nature. Nature provides us with clear models for how we should exist , whether we look at the human body or ecosystems. In a healthy organism, each part takes what it needs for its own maintenance, and the rest is for the well-being of the whole. Nothing is consumed in excess. For this reason the economy will not improve until we change our attitudes towards others and learn to work together. Michael Laitman offers wonderful insight on this in his blog.

Thank you for your interest. This blog is no longer active.



Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

BW Mall - Sponsored Links

Buy a link now!