Job Worries? You’re Not Alone
It’s no secret that our current economic downturn has created worry among students at UC Irvine and other campuses across the nation who are seeking to enter the job market with limited opportunities. But just when you thought that having to compete with other college students was hard enough, there is another caveat that will make your job hunt a tad more difficult and strenuous: older and overqualified laid-off workers.
Since thousands of white-collar workers from the financial and information technology industries, among others, have lost their jobs, in addition to blue-collar workers, a large population of overqualified workers have emerged as they seek positions that are far below their skill sets, settling for anything from waiting tables to working the cash register just to survive financially in the short run.
However, in a National Public Radio podcast, Damian Birkle of Professionals in Transition, an organization that helps individuals try to find employment, mentioned that there are drawbacks in white-collar workers resorting to entry-level positions. He advocates that professionals employ a long-term perspective by investing time they would’ve spent working to find higher-level and better-paying positions that suit their skill sets rather than grabbing part-time jobs.
While this might be a reasonable path to take for families that have saved enough income to stay afloat financially for several months without a job, this is not a realistic possibility for those who live paycheck to paycheck or are struggling to keep up with their mortgages with the looming possibility of foreclosure. This could lead to a temporary vicious cycle in which overqualified individuals living week to week get stuck in part-time or entry-level jobs and don’t search for jobs in accordance to their skills; consequently, it will make it difficult for college graduates and other youths to occupy these types of positions that would typically be catered for them.
According to the U.S. Bureau of Labor Statistics, with the unemployment rate at 8.9 percent as of April, there are now 13.7 million individuals unemployed, as 5.7 million people have lost their jobs since the start of the recession in December 2007. However, when including individuals who have stopped looking for work or part-time workers who aren’t technically considered unemployed, the April unemployment rate is 15.8 percent. Chairman of the Federal Reserve Ben Bernanke also announced this past week that unemployment figures will most likely rise heading into 2010 while some economists believe that it won’t be until 2013 that unemployment returns to its natural rate at around 5 percent.
To alleviate the surge in unemployment seen in the past several months, President Barack Obama has taken a proactive step in addressing the issue of idle workers by unveiling a partnership between the U.S. Department of Labor and the U.S. Department of Education, which can be viewed at www.opportunity.gov. The program is intended to provide unemployed workers with educational opportunities to help them become more competitive candidates in the job market, offering up to $5,350 in Federal Pell Grants to cover education expenses, whether it is at a university or a trade school.
While this type of program is a positive step toward improving employment prospects of unemployed Americans, it raises the standards of employment as educational attainment becomes a more significant factor. Therefore, college students will not necessarily have an edge in the job market as an influx of older, unemployed workers into the education system might create greater competition in the short run.
Although some have criticized Obama’s $787 billion fiscal stimulus as excessive, which includes an initiative to create 3.5 million jobs through programs such as this one, there could be a serious social fallout. Since large numbers of unemployed adults, in addition to students, are seeking to enter the job market, the U.S. needs to put people to work either through green jobs as Obama has proposed or other initiatives.
Unrest can already be seen in Europe, as there were riots in Greece last December in response to rising youth unemployment, which caused havoc in the country while France is having similar problems with high youth unemployment, especially among minorities. In response, President Nicolas Sarkozy has laid a 1.3 billion Euro initiative to offer training for youth as well as tax incentives for corporations to take youth workers under their wing.
To prevent a similar outcome in the U.S., there needs to be a focus on providing incentives to match high-skilled workers with jobs that suit their skill levels while opening up entry-level positions for college graduates and other youths trying to find work, even if wages or salary offers aren’t necessarily appealing.
Although this might be a pessimistic viewpoint, at this point in the economy it’s not exactly a question of the government maximizing the population’s welfare and personal well-being, but rather minimizing its discontent. There is clearly no magical formula that will put all laid-off workers back to work and preserve jobs for all new job market entrants, especially as the American automotive empire begins to crumble and financial institutions continue to see red. As we remain in this economic state of flux and overqualified workers spill over into jobs typically aimed for graduates and other youths, the short-term and logical solution for students to improve their job prospects and be competitive is simply to increase their skill sets and have the survival mentality that overqualified workers have developed, as things will certainly get worse before they get better.
Ara Demirjian is a third-year business economics major. He can be reached at email@example.com.