Taking a first job out of college below your education and skillset can be a permanent setback.

We’ve all heard the story about college graduates who find themselves working at local coffee shops. We know recent grads who are unsure of what direction to go in, so they take placeholder jobs for a year or two until they figure it out. These scenarios seem normal and benign, however, that first job out of college matters more than you may think. Studies show that the transition out of college into the workforce is critical and the decisions and consequences of this transition stick with you for a very long time.

Those who start off underemployed tend to stay underemployed and the impact is compounded over time. Roughly 40% of college graduates are underemployed in their first job and start out earning, on average, $10,000 less than their appropriately employed counterparts. 74% of these people remain underemployed after 10 years in the workforce with the wage gap growing exponentially. Once you find yourself there, underemployment is difficult to escape with only a third of workers managing to move into positions requiring their earned degrees. Conversely, those who begin their careers in positions that are equivalent to their education and skillset stay that way and have minimal risk of sliding backward. 

“Compromise jobs” are not created equally. The field in which graduates find themselves makes a difference in the long-term prospects. Those who start off underemployed in a field with bachelor’s level positions to grow into have a better likelihood of recovering than others. For example, working as a help desk technician may lead to promotions that will strengthen a resume, whereas working as a bartender does not provide the same opportunities. Working in a field with few college level opportunities poses potential hurdles in breaking out of the underemployment cycle; these graduates are not picking up on-the-job skills that will lead to bachelor’s level positions, they are not building connections in their chosen industry, and future employers may disregard them due to their lower skilled jobs even if they have the credentials.

That initial job impacts the trajectory of long-term career prospects. It can set graduates on their career paths, or it could prove to be a setback. Those who find themselves in sub bachelor’s level positions face real consequences that may impact them for years to come. That first job is a critical decision and should be treated accordingly.