What New College Grads Need to Know About the Job Market During the Economic Downturn

Students are worried, now more than ever, that they won’t be able to find gainful employment after graduation due to the coronavirus (COVID 19) pandemic. The stock market is crashing, businesses are closing, and to add insult to injury, toilet paper is sold out everywhere and is now being auctioned off on the black market for 100x it’s value. 

The world is in chaos. But, keep in mind, this isn’t the first economic hardship this country has faced, and it won’t be the last. 

The Great Recession

The job market has survived situations like this before. We’ve done some research on the most recent economic recession, which began in December of 2007, and how it affected employment for college graduates.

The Recession of 2008, also known as the Great Recession, began after the housing market crashed. In summation, people accepted home loans they couldn’t afford to pay back, which led to a credit crisis ending in a government bailout. 

According to CNN, about 50% of college graduates seeking employment after the Great Recession were still identifying as underemployed or filling jobs that did not require a college degree. 

Many employers, during this time, had reduced the number of job openings they had originally expected to fill in an attempt to recover from the recession. 

This left many graduates without a job and searching for anything available, regardless of their field of study. When the economy began to recover in mid-2009, and jobs started to become available, many of those grads from 2007-2008 were faced with the major disadvantage of competing for entry-level jobs with more recent college graduates.

Negative Effects of the Economic Recession

The National Bureau of Economic Research conducted studies of the short and long term effects of graduating into a recession. Some of the findings have reported that there are less desirable positions available for graduates to choose from. This leads to different challenges, such as:

  • Settling for a job, any job, to ensure an income 
  • Working for smaller companies who might offer lesser salaries
  • A lot of job movement when the economy stabilizes, and candidates have a few years of experience. This helps in recovering some of the initial loss in taking less attractive jobs after graduating

Positive Effects of the Economic Recession

While some of this information can be unsettling for those getting ready to enter into the workforce during an economic downturn, it’s important to note that there are some positive findings as well. The Harvard Business Review showed the positive impact the recession had on people in the job market. Here are some important things to note:

  • While people made less money, they found they were overall happier than in comparison to counterparts who were hired when the economy was rising.
  • People that found employees worked harder and were more grateful for the opportunity –  some even went on to become senior leaders and CEOs.
  • Because they had to work so hard to find a job and beat many other applicants for the position, they were more respected than their peers that were hired during a more favorable economy.
  • Those that were employed during the recession were overall less likely to engage in unethical business conduct.

So what does this mean for the world today? 

In short, it’s not going to be as bad as it seems, and things are going to turn around. Eventually.

Transitioning to Telecommuting

In recent days, since the coronavirus pandemic, many companies have adapted to a work from home format— which proves many jobs can be done remotely. 

With technology ever advancing, especially since the Great Recession, people can continue with their daily work routine with little negative impact. Laptops, tablets, and cell phones allow staff to stay connected and support each other from afar without having to walk into an office. 

In fact, telecommuting has been expanding at a tremendous rate. Since 2005, working remotely has grown by 173% across the non-self-employed working population. In fact, the United States has seen a 115% growth in these types of jobs over the last ten years. 

Telecommuting is becoming more of a trend with big businesses as flexible work schedules draw in more talent and helps to retain employees. According to recent studies, 80% of employees said they would turn down an offer that did not allow working remotely, and businesses (85% surveyed) have confirmed that productivity has increased amongst their employees due to remote flexibility. 

Finding Employment in a Post-COVID-19 World

Today, with the concerns and risks associated with COVID-19, many employers are closing their doors to interviews and instituting a hiring freeze until things pass. For companies still seeking to hire, they’re changing their interview structure to phone and video interviews instead of meeting in person. 

Building up your social media presence is more important now than ever— clean up your Facebook and dress up your LinkedIn. Having a strong social media presence makes you more attractive to recruiters and hiring managers.

With many companies shifting their operations and all employees working from home, Charlie Javice, CEO of FRANK, points out that, 

New grads will now have the opportunity to choose where to live as the world shifts online and should take advantage of the modern online workplace…”

This shift will open up the job market and increase opportunities for new grads who will now be able to apply for more jobs without being limited by their geographical location. So, don’t lose hope, there is an upside to the economic issues we’re facing today. We might just come out of this with a whole new world of opportunities at our fingertips.