Is it normal to be underemployed right after graduation?
Yes, and right now it is unusually common. You are not an outlier for landing in a role that does not require your degree; you entered a slow market at a tough moment.
The hiring picture at the start of 2026 was genuinely difficult for new graduates. According to the Federal Reserve Bank of New York's report on the labor market for recent college graduates, published on May 5, 2026, the unemployment rate for recent grads sat at about 5.7 percent in the first quarter, with underemployment at 41.5 percent. That means a large share of degree holders were working in jobs that did not require the credential they earned. A separate New York Fed study reported by Forbes on February 23, 2026 put recent-grad underemployment near its highest level since 2020.
The broader job market gave those grads little momentum. The U.S. Bureau of Labor Statistics Employment Situation for June 2026, released July 2, 2026, showed employers adding just 57,000 jobs that month, with leisure and hospitality actually losing 61,000 positions amid weaker seasonal hiring, and unemployment holding at 4.2 percent. When hiring cools like this, entry-level roles are among the first to thin out. In other words, your situation reflects conditions, not a personal failure.
Does taking a job below my degree level actually hurt my career?
It can, but the damage comes from staying stuck, not from starting there. The risk is measurable, which is exactly why a plan matters.
Research from the Federal Reserve Bank of St. Louis, published August 13, 2025 and drawing on the Burning Glass and Strada 'Talent Disrupted' report, describes a 'scarring' effect. Roughly 52 percent of graduates are underemployed at labor-market entry, and about 45 percent remain underemployed even 10 years after graduation. The earnings gap is the part that should focus your attention: underemployed graduates earned only about 25 percent more than a typical high-school graduate, while those working in degree-level jobs earned about 88 percent more.
That spread is the real cost. The danger is not the first job itself; it is drifting for years without moving toward work that uses your training. Understanding the mechanism helps you fight it. Employers often infer future potential from the level of your recent roles, so each year in an underemployed position can make the next degree-level job feel slightly further away. The antidote is to keep signaling, through your work and your resume, that you are operating above the job title on paper.
How do I describe an underemployed job on my resume?
Describe it by outcomes and transferable skills, not by the job's baseline duties. A well-framed retail or service role can read like early management experience if that is honestly what you did.
Start by separating the tasks anyone in the role performs from the responsibilities you took on beyond them. Did you train new hires, own a section of inventory, handle escalations, reconcile a register, build a spreadsheet that saved time, or cover for a manager? Those are the lines that belong at the top of each bullet, phrased with concrete numbers wherever you can attach them. A hiring manager scanning quickly should see initiative and results, not just a job category.
Next, name the skills in the language of the field you want to enter. If you majored in something analytical, foreground the parts of your current job that involved data, problem-solving, or process improvement. If you want a communications role, emphasize the writing, customer interaction, or coordination you handled. You are not inventing anything; you are choosing which true details to elevate. This is honest positioning, and it is what every effective resume does.
Finally, keep the underemployed role from being the only recent thing on your resume. Add a section for freelance projects, volunteer work, a certification in progress, or a portfolio piece. This shows a reviewer that your degree-level capabilities are active and current, which directly counters the assumption that underemployment reflects your ceiling.
How long should I stay before moving on?
Treat the role as a launchpad with a rough expiration date rather than an open-ended stay. Roughly one to two years is enough to show reliability without letting the scarring effect harden.
Given that the St. Louis Fed research shows nearly half of underemployed grads are still underemployed a decade later, the practical lesson is to build momentum early while the gap is small. During your time in the role, spend deliberate effort on three fronts. Keep applying for degree-level positions even in a slow market, because the New York Fed data confirms openings exist even when hiring is soft. Build one demonstrable skill that maps to your target field, through a project, a course, or a certification you can point to. And nurture relationships with people already doing the work you want, since referrals often move faster than applications when postings are scarce.
It also helps to understand why competition is fierce. A Lightcast economist cited by IndexBox on February 23, 2026 noted that only 178 of more than 800 occupations projected by the BLS typically require a bachelor's degree, a mismatch sometimes described as elite overproduction. Knowing this reframes your search: rather than chasing every posting that mentions your major, target the specific roles where a degree is genuinely required and valued, and tailor your materials to those. That focus tends to produce faster results than casting a wide net.
The throughline is agency. Underemployment early in a slow market is common and, on its own, forgivable to future employers. What separates the graduates who recover from those who stay stuck is deliberate, sustained movement toward degree-level work while framing the present role as evidence of drive.