Millennials have struggled to find well-paid jobs despite being the most-educated generation. It's because there are more college degrees, but fewer jobs that require them.

• Millennials have higher college attainment than Gen X, but get less value out of a degree.
• That's because of higher tuition costs, and fewer available jobs that require a college degree.

Millennials may be the most educated generation, but a college degree is doing much less for them than it did for their parents and grandparents.

That's according to a new working paper published by the National Bureau of Economic Research, which found that the class of 2013 had worse financial outcomes than the class of 1996.

Members of the college class of 2013 are millennials in their early 30s who graduated nearly a decade ago. They have a higher unemployment rate than their predecessors — 12% versus Gen X's 9% — as well as more student loans. They're also more likely to live at home.

These findings underscore what advocates of student debt relief — who just saw a win with President Biden's recent cancellation of up to $20,000 in debt for federal borrowers making under $125,000 a year — often tout. They make the point that over the last few decades, the cost of higher education has shifted from a necessary and manageable step to financial mobility to an often crippling burden.

"It is simply impossible for students to work their way through college in the way previous generations could," Susan Dynarski, an economist at Harvard University, wrote in The New York Times this week.

The NBER researchers found that the shrinking availability of "matched jobs," or jobs that require a college degree, is responsible for millennials' worsening financial prospects over the years. That disparity in labor prospects post-grad joins a list of other reasons millennials are doing worse than generations past financially: namely, graduating in the Great Recession and long being shut out of the housing market.

Millennials aren't getting the jobs they studied — and paid — for

Mismatched jobs typically pay less than jobs that match a workers' skills, and the gap between them has increased exponentially over the last 20 years, the NBER researchers explained. While 1996 grads in matched roles made 12% more than their peers in unmatched ones, pay for 2013 grads in matched roles was 34% greater.

More millennials are finding themselves in mismatched positions than Gen Xs did — the job mismatch rate for the 2013 graduation cohort at age 23 to 27 years is around 52% on average, the researchers found, 7% higher than for the 1996 graduation cohort at the same age.

Some examples of growing industries that don't require college degrees are carpentry, service sales, insurance sales, and plumbing. Between 2018 and 2028, the Bureau of Labor Statistics predicts that each of those fields will gain more than 68,000 US employees.

The study also found that the lack of matched jobs explains two-thirds of the rise in unemployment between the 2013 and 1996 cohorts, as well as the class of 2013's greater likelihood of having roommates.

That's in addition to the class of 2013 being more likely to be unemployed or live at home with their parents, which matches the findings of other recent studies. The share of young adults who live at home rose from 8% in 1971 to 17% in 2021, especially for people between the ages of 25 and 29 — 31% of which live in multigenerational homes the Pew Research Center reported last month.

Last year, millennials' employment-to-population ratio fell the most of any age group since 2000, spurred in large part by the pandemic. Research from the Federal Reserve Bank of St. Louis Fed suggested that millennials in particular faced lower overall employment before the pandemic began, however.