Payal Batra graduated college in May of 2015 and spent months looking through job-search websites, refreshing them five to six times a day, losing hope with each click. Batra graduated without securing a full-time job and accepted an internship for the summer to buy her some time.
“I think it was very tough finding a job,’’ she said. “Honestly a lot of it I felt like it had to do with societal pressure. Many older generations still feel like it’s so easy to get a job right after graduation when it’s much harder than it was during their time.’’
The internship was followed by a part-time job at a mall jewelry store, but two months ago she finally landed a full-time position. She secured a full-time position as a resident director at EF International Language Center New York. Batra is one of hundreds of thousands of Millennials who, despite the wait, are getting full-time jobs in today’s recovering economy.
With the American economy slowly improving, Millennials should feel increasingly confident about their work situations. They are primed to move into the growing service sector and higher-paying jobs as the economic expansion continues with rising wages and falling unemployment rates promises a brighter future for this generation.
As of April, Millennials officially outnumbered Baby Boomers as America’s largest living generation, according to the U.S. Census Bureau. The Pew Research Center defines Millennials as those ages 18 to 34 in 2015. While older generations stereotype Millennials as lazy and less motivated to work, there is proof that this younger generation simply grew up around different technology and background. A report from Goldman Sachs concludes that as Millennials have come of age in a time of technological change, globalization and economic disruption, their new “sharing economy”, changing e-tail habits and affinity for technology will hugely impact the economy as they reach their prime working and spending years.
These twenty- and thirtysomethings have experienced major debt in the form of college loans and have begun trickling into the American workforce. A study by the Economic Policy Institute shows that unemployment rates of young workers are significantly higher than before the recession began and raises the question of whether these members of the labor market really have a safety net.
The report also highlights that the economy has seen unemployment rates drop for the overall labor force, but unfortunately for young workers, they tend to get hit a little bit harder during economic downturn.
“Each graduating class that we’ve looked at in this report has had a slightly better outlook than the year before for the past couple of years so things are slowly getting better for the class of 2016 graduating into this labor market, but they’re still going to hurt,” Tanyell Cooke, a co-author of the Class of 2016 report, said.
Even when Millennials found jobs, they were often forced to take low-wage ones. According to a 2014 Current Issues report released by the Federal Reserve Bank of New York, individuals over the past several decades have had gloomy employment outlooks especially after the 2001 and 2009 recessions.
The lack of employment immediately out of college is not something unique to the Great Recession nor to Millennials: from 1990 through the first three months of 2013, the unemployment rate averaged 4.3 percent for recent college graduates compared with 2.9 percent for all college graduates, according to the Federal Reserve Bank of New York. This means that finding a job tends to be more difficult for those just out of school than for those who have been out of school longer. They have been forced to take lower-quality and part-time jobs. Now that is changing as 22-year-old Evan Rosenberg illustrates.
He graduated from SUNY New Paltz in December but walked at graduation as part of the Class of 2016. Two weeks after graduating, he was accepted into the New York City Teaching Fellows program. The program will allow Rosenberg to get a Master’s in Childhood Special Education at Hunter College and be a full-time employed teacher. He lives at home with his parents, fitting right into a recent trend reported by the Pew Research Center in which Millennials are more likely to be living in their parents’ home than elsewhere. Up until the teaching program starts, Rosenberg works part-time as a custodian to make extra money.
“I like the custodial work as a short term option because it’s decent pay and it’s pretty low stress,” Andrew said. “I’m excited to have the teaching job, I feel like I’m ten steps ahead of lots of other people my age. I have a chronic illness so being insured is paramount. Also there’s so much upward mobility—granted I’ll be making peanuts at first but still, I can only go up from here.”
Rosenberg has Crohn’s Disease, which requires him to see a specialist to treat him and take medicine that would be expensive if he was not uninsured. Before his tuition, union dues and taxes are deducted, his starting salary will be $50,000.
“I was super lucky to graduate with zero student debt, and the fellowship subsidize the majority of my school bills. What I do pay for my master’s comes out of my check before I even see it, so I come out of the whole experience debt free,” Rosenberg said. “I’m just happy I have a job that has growth, honestly.”
In this month’s Employment Situation report, the Labor Department reported a slowdown in total nonfarm payrolls, but growth in sectors with higher-paying wages. A slight increase in hourly earnings was also reported. The U.S. economy saw weak growth in the first several months of this year, as highlighted in April’s first quarter GDP report.
Millennials make up a large portion of the age group that tends to get jobs in the growing areas such as lower-paying retail and food service work to higher-paying jobs in professional, business, education and health services. As these prime age workers find their spots in the workforce and continuing working their way up, they will have more money in their pockets and have more money to spend. Given that consumers make up 70 percent of the economy’s GDP, the boost in work and wages may be what the economy needs.
Although wages of young college and high school graduates have experienced little to no growth since 2000, Cooke said there are policies that would help these young workers have healthier wages and find work.
“This group has a better outlook, but under the hood there are still some things that need to be fixed,” Cooke said.
Cooke and the Class of 2016 co-authors call on the Federal Reserve to help by keeping interest rates low until the economy strengthens. This may be the case as the Fed has remained cautious on raising interest rates since the last raise in December. They also recommended raising the minimum wage to lift young graduates’ pay, a change scheduled to take place in at least 14 city and states in the next 10 years. Among other recommendations is the strengthening of workers’ collective bargaining rights, earned sick leave and ending discriminatory practices that contribute to race and gender inequities.
“The overall labor market itself is doing better, we’re seeing the overall unemployment rate drop and we’re seeing overall underemployment rate drop,” Cooke said. “Young people are benefitting from that as well. There are jobs being added into the economy for these young grads. We’re seeing the labor market warm up and this is good news for the Class of 2016 compared to the years before them.”