Are You Underemployed? Why Your Next Job Is So Important

Apr 14, 2024

Everyone is familiar with the tale of the bartender with an English degree or the barista who majored in business. Often, jobs like those are simply considered slight detours, or even a right of passage, for recent college grads.

But research suggests that underemployment is much more than just a bump in the road—it can lead to long-term consequences.

A recent Burning Glass study found that 43% of college graduates surveyed were underemployed in their first job. Five years later, roughly two-thirds of that group were still underemployed. Ten years after graduation, the numbers barely budged.

Those stats may seem abstract, but they have real-world consequences. A recent grad who starts off underemployed will see lower salaries and fewer chances for promotion throughout their career.

And the effects compound as they move from job to job, creating a cycle of underemployment that’s difficult to break.

Difficult, but not impossible. With the right support and information, graduates who start out underemployed can catch up to their peers. It starts with understanding what underemployment really means and why it happens to even the best recent grads.

Because once you understand why it happens, then you can take action to break the cycle and find fulfilling work.

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1. What does it mean to be underemployed?

Defining underemployment is notoriously tricky. Even the Burning Glass study admits the term “is both overused and ill defined.”

Some definitions only include people who are working part-time, but want to work full-time. However, that doesn’t come close to capturing the full scope of underemployment.

On the other hand, calling someone underemployed just because they’re working in a job that doesn’t utilize their college degree is much too broad. The value of a college degreeis becoming more questionable, as skills and experience take precedence over diplomas.

A better definition of underemployment focuses on skills. Here’s an easy way to think about it: if you're in a job that's below your skill-level—meaning you're not using the skills you want to be developing for your career—then you're underemployed.

2. What causes underemployment?

There are four main reasons that lead recent grads to underemployment.

  1. They’re unfamiliar with the way employers talk about skills. Most recent grads undervalue themselves. They think they can’t do a job when they look at the description and don’t see anything familiar. In reality, they might have all the skills and attributes to excel in that role—they just don’t understand the terminology the company is using. So, instead of exploring and applying to all relevant opportunities, they limit themselves to a small selection of roles.

  2. No one taught them how to market their skills. Other candidates know all of the transferable skills they have, but they don’t know how to effectively communicate their value to a company. They don’t know how to market their abilities successfully, so they struggle to land interviews or get offers, despite applying to hundreds of jobs.

  3. No one taught them what skills are in demand. This is classic supply and demand. I’ve worked with candidates who were baffled that they weren’t hearing back after applying. They didn’t realize that the skills they were marketing were not in demand, and they needed to “upskill.” The problem is, it’s hard to know what skills to develop because candidates rarely get feedback from employers on why they weren’t hired.

  4. They get bad advice on the job search. Unfortunately, bad advice about finding a job is rampant. Candidates are encouraged to apply to as many jobs as possible and use job boards and “one-click apply” buttons. The ROI on those activities is incredibly low, yet most people continue to use the same ineffective tactics and get stuck in a long and frustrating job search, leading them to settle for jobs that underutilize their skills.

Keep in mind, these stages aren’t necessarily linear. And it only takes one of them to send someone into a cycle of underemployment.

3. How does underemployment impact someone’s long-term career?

Underemployed grads start their careers at a disadvantage, and the effects accumulate over time.

If you’re doing a job below your skill level, that means you aren’t using or developing your current skill set, let alone building a more advanced one. On the other hand, someone whoisspending all day at work learning and building on their knowledge has an edge.

It becomes a vicious cycle. The people who start off “ahead” tend to stay there because they have the time, opportunities, and connections to continue working on their skills and advancing in their career. That’s why the Burning Glass study calls underemployment “the permanent detour”—it can be difficult for grads to get back on track.

But none of this is to say that breaking the cycle is impossible. In fact, if you’re underemployed right now, there’s no reason your detour has to be permanent.

4. How do you break the cycle of underemployment?

As dire as the statistics and studies may sound, it’s important to remember that statistics are not destiny.

  • To break out of the cycle of underemployment, first, commit to leaving your current job. It’s easy to get comfortable in a job that isn’t pushing you or forcing you to grow. You may not love bartending, but maybe you like your coworkers and you know what to expect every night.

So make the commitment to getting out of that comfort zone and begin looking at your current job as a short-term solution to pay the bills. Nothing more.

  • Next, identify your skills and attributes and how they relate to the skills that are in demand. For example, jobs in customer success, marketing, and sales are in high demand, and have a low barrier to entry. Plus, the skills required in these roles will often overlap with the skills in your current job.

Spend some time learning more about the roles you see alignment with. You don’t have to go to grad school or spend a ton of money on an online class, either. Take a couple week-long courses, get an internship, or just spend your downtime researching the industry and networking with people in those roles.

  • Lastly, make sure you’re effective in your job search. Applying to hundreds of jobs may seem productive, but when you look at the data, you’ll realize the likelihood of hearing back from an online job application is miniscule. Instead, seek internal referrals by building genuine relationships, and take advantage of tools like Edvo that help you build of job hunting strategy.

Starting out underemployed isn’t ideal, but it doesn’t have to define you or your career. Armed with the right information and a little determination, you can break the cycle, end the detour, and get back on the road to a meaningful career.