The Wage Growth Gap for Recent College Grads

Source: Bart Hobijn and Leila Bengali, Federal Reserve Bank of San Francisco, Economic Letter, July 21, 2014

Median starting wages of recent college graduates have not kept pace with median earnings for all workers over the past six years. This type of gap in wage growth also appeared after the 2001 recession and closed only late in the subsequent labor market recovery. However the wage gap in the current recovery is substantially larger and has lasted longer than in the past. The larger gap represents slow growth in starting salaries for graduates, rather than a shift in types of jobs, and reflects continued weakness in the demand for labor overall.