Children of The Great Recession

Ronald Brownstein
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Image credit: Liz Lynch

The April sun shines brightly over the career development center at California State University (Los Angeles). Yet, despite the perfect weather, the center's conference room is crammed with students taking notes intently. Judy Narcisse, a counselor at the center, is running a workshop on résumé writing.

Gesturing toward a PowerPoint presentation on a large screen, Narcisse marches her charges through the basics. Her tone is casual, and her humor deadpan, but her advice is hard-headed. "If you're going to leave your cellphone number, don't have rap music on your voice mail," she explains. "You can't say, 'Hey, this is Naomi! Give me a holla!' "

As Narcisse speaks, heads bob and pens scribble. Her students at this heavily Hispanic and Asian, working-class university of about 20,000 located east of downtown Los Angeles are attentive to a fault. "What if I don't have enough experience to fill a piece of paper?" one young woman asks. Print your résumé with wider margins or a larger font size, Narcisse replies. She is full of such practical suggestions: Find internships, she recommends, attend career fairs, volunteer, proofread your résumé. At times, Narcisse sounds like a coach delivering a halftime pep talk. "We're in a tough economic market," she says bluntly. "You're going to have to hustle."

The message is not lost on these children of the Great Recession, or on the massive Millennial Generation they embody. The Millennials, best defined as people born between 1981 and 2002, are now the largest generation in the United States, with nearly 92 million members according to the latest Census Bureau figures. They are the most diverse generation in American history (more than two-fifths are nonwhite, according to the census), and they are en route to possibly becoming the best-educated: About half of Millennial men and 60 percent of Millennial women older than 18 have at least some college education. They are frequently described as a civic generation, more oriented toward public service and volunteerism and more instinctively optimistic than any cohort of young people since the fabled GI Generation that fought World War II and built postwar America.

And now their great expectations are colliding with diminished circumstances. Millions in the generation are navigating the transition to adulthood through the howling gale of the worst economic downturn since the Depression. Federal statistics tell a bracing story. The unemployment rate among 20-to-24-year-olds stood at nearly 16 percent in March, more than double the level of three years earlier, before the recession began. For those 25 to 29, unemployment stood at 11.5 percent, also more than double the level of three years ago. For teenagers, 20-something African-Americans and Hispanics, and young people without a college degree, the unemployment rates spike as high as 28 percent--debilitating levels of the kind that Americans haven't seen in decades.

Even in this dire climate, some Millennials are finding new ways to weather the storm, displaying the instinct for pragmatic problem-solving that generational theorists consider one of their defining characteristics. They are flocking into service-oriented alternatives such as Teach for America or partnering with peers to launch innovative entrepreneurial ventures.

But for many others, the working world has become an inscrutable maze of part-time jobs, temporary gigs, and full-time positions that abruptly dissolve into layoffs and start the entire disorienting cycle again. Such widespread uncertainty could impose lasting costs, measured not only in diminished opportunity and earnings for the Millennials themselves, but lost productivity and multiplying social challenges for American society at large. "If the jobless recovery ... drags on for three or four years, then I think we will face some large problems that we haven't faced since the Great Depression," says Robert Reich, who served as Labor secretary in the Clinton administration. "Young people are just not going to form the habits and attachments to work that their older siblings or parents have had, and that could conceivably create a whole variety of social problems."

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The Broken Escalator

When the job market works well, it functions like an escalator. Young people finish their schooling, whether high school or higher education, and move onto the escalator's bottom steps with entry-level jobs. As they acquire more skills and experience, they rise into better-paying and more-senior positions, clearing space on the first steps for the next crop of new graduates. Meanwhile, on the top steps, older workers step off into retirement, creating room that allows everyone below them to ascend through their own careers.

But now the escalator is jammed at every level. With jobs scarce, many young people are stuck at the bottom, unable to take that first step. Those who have been lucky or skillful enough to get on the escalator in the past few years are often not rising smoothly. They might gain a job, lose it, and fall back several steps or off the escalator altogether. There they must jostle with each successive class of graduates trying to squeeze on at the bottom. Meanwhile, at the other end, with the stock market's collapse decimating 401(k) plans, fewer older workers are moving briskly off the escalator into retirement. (Federal statistics show that while participation in the labor force is declining slightly for middle-aged workers, and sharply for younger workers, it has actually increased since 2007 among workers ages 55 to 64.) The continued presence of this older generation on the escalator makes it more difficult for everyone behind them to ascend, intensifying the pileup at the lower levels. Compounding the pressure, more middle-aged workers are being toppled from the upper steps by layoffs, which force them to compete for space lower down that junior colleagues might once have occupied. Rather than advancing in smooth procession, everyone is stepping on everybody else.

The pileup is being felt keenly this spring on college campuses. Last year, the bottom fell out of the job market for the class of 2009. The Collegiate Employment Research Institute at Michigan State University, which tracks these trends nationwide, found that last spring large employers hired 42 percent fewer graduating students than they had originally targeted when the school year began. It was a "rout," the group reported in its latest annual survey. This year, the job market for graduates appears to have stabilized and may even be rebounding slightly--albeit from that sharply reduced new starting point--says Phil Gardner, the institute's director. "We see sporadic little shoots grow up here and there," he explains, "but ... no surge."

Career counselors at a wide variety of colleges and universities echo Gardner's equivocal verdict. "Things are starting to thaw," says Paula Klempay, the director of M.B.A. career services at the University of Washington's Foster School of Business. "We're not as robust as we were two years ago, but we're better than last year." Jaime Velasquez, assistant director of career services at the University of Illinois (Chicago), says that the number of employers at the school's job fair jumped from 50 last year to 62 this spring, "and they all had positions available." Still, he notes, "five years ago, we had 110 [firms]."

School Daze

The climate has improved enough--modestly but perceptibly--that success stories on campus are again growing more common. Kesha McLaren, a senior at the University of Missouri's College of Agriculture, struck out when she tried submitting her résumé directly to employers, but she was hired by an agricultural finance company in St. Louis after a professor steered a recruiter in her direction. "It was the only position I was offered, but that doesn't bother me, because it was kind of my dream job," she says. Halfway across the country, the undergraduate business school at Howard University, a historically black college in Washington, D.C., this year has placed 90 percent of its honors students in graduate school or full-time work. Ann Jackson, a 21-year-old graduating this spring, is moving to Portland, Ore., after winning a job at Intel's human relations department. "I got lucky, honestly," she says. "I'd been in a lot of interviews, and there were quite a few I didn't get."

Despite these flickers of improvement, the challenges remain substantial, even for graduates of elite institutions. In 2009, the unemployment rate among 20-to-24-year-olds with four-year college degrees stood at 8.8 percent, twice what it was just two years earlier. Many college officials concur with John Noble, the director of career counseling at Williams College in Massachusetts, who says that even with some recent revival, "this is the worst market I've seen since I started in this line of work in 1982."

That wouldn't be news to Matt Handler, who has stockpiled laurels at Brooklyn Law School: top 10 percent of his class, an editor on the law review, a summer internship at a prominent international law firm. Yet a few weeks from graduation, he still hasn't received an employment offer. "After everything that's happened with the economy," he says, "hard work doesn't pay off like it used to." Megan Whitaker, a graduating anthropology major at UCLA, has watched her boyfriend apply futilely for work since he graduated as an international business major last year from Cal Poly Pomona. "I see this boy apply for literally 10 jobs a day," she says. "He'll get an interview once every couple of months, and it's for a job selling knives or something."

Antonino Lyons, another senior at Howard, received an unusually intimate look at the economy's turmoil after he was "adopted" by Merrill Lynch through an innovative program that matches employers with undergraduates for mentoring. It all worked well enough until Merrill was swallowed by Bank of America during the financial crisis--and his contact at the firm was laid off. The experience helped convince Lyons to extend his schooling with a cultural exchange program in Brazil while he waits for the economy to stabilize. He says the Merrill melodrama "gave us a real-life perspective on how business actually works--or doesn't. They couldn't hide it from us, and there was no way to keep us in a silo to make it seem like everything was running as normal."

Complicating matters for the graduating class of 2010 are the substantial number of students from previous classes who, like Megan Whitaker's boyfriend, are still competing for entry-level positions. Sean Sposito, for instance, graduated from the University of Missouri's journalism school in 2009 but is looking for work again after completing a one-year internship with the Newark, N.J., Star-Ledger--which he supplemented with jobs as a bar bouncer. "To me this is regular," he says of the uncertainty he faces. "I haven't known a professional life outside of this." Rich Brusa graduated from San Francisco State University in 2007 and since then has wandered through a workplace odyssey that might have inspired Homer to add another verse: hired and laid off by a local television station; stints as a waiter, an overnight DJ at a radio station, and a production assistant at a cable TV company; more layoffs; a contract with a second TV production company; and a switch to a different department at the radio station. "And then, six months later the contract ended," he says. "[But] I've kept the radio gig, and I've been picking up freelance jobs."
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Economists say that young people who enter the workforce during recessions never entirely recover from the delays they face at the foot of the escalator. Over the course of their working lives, their wages remain lower than those of young people who enter the workforce when times are flush. The social cost for these detours and reversals is high, too. Gardner says the economy will be dealing for years with a mismatch between the skills that new graduates have acquired and the work that is available for them. "When this all gets said and done ... we are going to have a pile of highly skilled people underutilized in the economy, frustrated because they don't know how to get out of these positions, and maybe just giving up," he says.

The challenges facing Millennials only rise as their education levels decline. In 2009, 20 percent of 20-to-24-year-olds with only a high school degree were unemployed, according to federal statistics. For those in the age group who did not finish high school, the unemployment rate soared to almost 28 percent. Carlotta Workman feels the weight of those numbers from her position as guidance counselor at the high school in blue-collar Zanesville, Ohio. "Kids are thinking, 'My mom just got laid off, so how am I going to get a job?' " she says.

Somewhat surprisingly, the federal data show that the unemployment rate was no greater last year for graduates of two-year community colleges than for graduates with four-year degrees. But that statistic says nothing about the quality of jobs available to the community college graduates. Roseanne Buckley, director of career services at Burlington County College in New Jersey, finds graduates still working in pizza parlors or holding down the other unskilled jobs that they used to help pay for school in the first place. "Before," she says, "you just expected that once you graduated and got your degree, you'd be able to land a job in that field." Instead, her graduates are often jostling for positions with older workers who have been laid off from more-lucrative positions. "They have no experience," Buckley says of her graduates. "How are they supposed to compete with somebody that's a little bit older, that has a lot of work experience?"

Alexandra Brooks, an ambitious 20-year-old attending the Community College of Beaver County in a preponderantly blue-collar area northwest of Pittsburgh, asks herself the same question. To pay expenses and help with her family's bills, Brooks works 50 hours a week, split between a work-study position at the college and a cashier's job at the local grocery store--all in addition to her classwork. She plans to begin studying for a bachelor's degree in criminology this fall, but as she watches the job market around her, she sometimes finds it difficult to maintain her characteristic optimism. "Even with the degree ... I might still be struggling," she worries aloud. "There are people [working] at the Stop 'n Save with master's and bachelor's degrees." The thought hangs over her like a cloud, but then she brightens. "The economy isn't going to stay bad forever," she says. "The Baby Boomers have to retire eventually." From her tone, it's not clear if this is a prediction or a plea.
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Image credit: Liz Lynch

Coping Mechanisms

Social analysts say that as a "civic generation" Millennials are more inclined to light candles than to curse the darkness. They tend to be pragmatic, team-oriented, resilient, and optimistic. In a recent Pew Research Center survey, for instance, only about one-third of Millennials said they were earning enough money now to live the kind of life they wanted. But among the two-thirds who said they weren't earning enough money now, nearly nine in 10 said they expected to earn enough someday. Morley Winograd, co-author of the 2008 book Millennial Makeover: MySpace, YouTube, and the Future of American Politics, says that although this generation is as likely as its elders to believe that big institutions such as government and business are broken, its reaction to that conclusion is different. "It isn't like the Baby Boomers who said, 'It's broken, let's tear down everything,' " says Winograd, a fellow at the Democratic advocacy group NDN. "In this generation, they say, 'These institutions are broken, we can fix them.' "

It is in that spirit that many Millennials are blazing innovative paths through the Great Recession. Alexander Develov, a senior finishing this spring at business-oriented Babson College in Wellesley, Mass., for instance, has already started a business that provides online video marketing services. "The recession is fantastic for somebody trying to start a business," he says. "You can't raise as much money, but you can get the best people."

Winograd notes that polls have found that Millennials list among their top economic priorities the opportunity to collaborate with peers and the chance to have an impact on the institutions where they work. Such attitudes could lead them to develop new ways of organizing their work lives, especially if their opportunities for stable long-term employment at a single company continue to narrow. One peek into that future might be Steadfast Associates, a Washington graphics and media firm that functions as a hub for an assortment of interrelated enterprises--a clothing retailer and design agency, a syndicate that links writers with freelance copywriting and advertising projects, and a nascent video production agency. "We're formalizing the gig economy," says Steadfast co-founder Andrew Martin, a 2006 graduate of Davidson College. "We want to give people a cohesive space to exist as a businessperson and as an artist.... The idea is, you have this group of people with marketable skills and you use those skills to produce your own independent creative projects. There's never been a better time."

Other Millennials are choosing to ride out the labor market's squalls by pursuing more education. Community college applications have soared 17 percent in the past two years--although the increase is driven in part by older people seeking new skills after layoffs. Demand at community colleges is so high that Bunker Hill Community College in Boston has been forced to add classes on a graveyard shift that begins at 11 p.m. Many young people with four-year degrees are seeking further education as well, although this reliance on graduate school as a harbor could prove a mixed blessing: While some experts say that acquiring more skills almost always pays off, others worry that students will simply accumulate more debt without obtaining the experience they need to begin moving up the workplace escalator. "Graduate school never solved a labor market problem," says Gardner of Michigan State.

But arguably this generation's most distinctive response to hard times is not entrepreneurship or extended education but rather a pursuit of public service, in all of its variations--a trend that was evident even before the recession struck. Edna Medford, who has spent more than two decades teaching history at Howard, sees the impulse toward service as a defining characteristic of this generation. "In the last couple of years, there is a return to that whole idea of being willing to commit to the larger group," she says. "It's truly refreshing."

Closed doors in the private workforce have only reinforced this inclination. Applications are surging at virtually every form of service-oriented institution. AmeriCorps, the national service program created by President Clinton, received nearly 250,000 applications last year--more than two and a half times the number it received in 2008. And so far this year, applications are running almost 60 percent higher than even that peak. Applications for the Peace Corps jumped almost 20 percent last year, to their highest level in the program's nearly 50-year history. At Teach for America, which recruits young college graduates to teach for two years in high-need urban and rural public schools, applications have nearly doubled since 2008, to more than 46,000. "I think the silver lining of the economic downturn is that it's caused people to re-examine what's truly important to them, and that's led folks to choose careers where they can make a difference," says Kerci Marcello Stroud, the communications director of Teach for America.

A similar wave is washing over the military, which is now able to choose from a growing pool of better-prepared applicants. The share of Army recruits with a high school degree jumped to 95 percent in 2009, from 79 percent as recently as 2007, and the Marines have a backlog of young people trying to join. "Continued high unemployment is one reason for interest in the military," acknowledges Curtis Gilroy, director of accession policy in the Office of the Defense Undersecretary for Personnel and Readiness. "But another is the patriotism exhibited by young people today." Howard University senior Frank Bonner, who enlisted to fly aircraft in the Navy after he graduates this spring, exemplifies these intertwined motivations. "A lot of it comes down to job security," he says, "and dedication to my country."

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Image credit: Liz Lynch

The Big Fixes


In many respects, the economic challenges facing young people are simply a more acute version of the threats confronting all Americans in this sharp downturn. And, as a result, many of the questions about how to create more opportunity for young Americans inevitably become tangled in the larger debates between the political parties about how to promote more prosperity for society overall--that is, whether the economy is more likely to respond to an agenda focused mostly on tax cuts and deregulation or one centered on government investment in areas such as education and alternative energy.

Yet in some ways the problems confronting the Millennial Generation are unique. Although unemployment has increased among all age groups, younger workers are falling out of the workforce much more rapidly than older workers--and more rapidly than they did in previous recessions. In fact, federal statistics show that the share of young people either working or actively looking for work was declining through the first part of the past decade, even before the recession hit. Such data suggest a growing problem in connecting young people to the world of work--in effect, a breakdown in the process of getting them to step onto the escalator. "They are just simply delaying their careers and their labor force connections," laments Reich, who is now a public policy professor at the University of California (Berkeley). "It's a social problem if young people, fresh out of school ... can't get into the labor force and have to sit around for a year or two or more."

What can be done to ease the pathway into work for more young people? Obviously, nothing will help more than an overall acceleration in job creation. But smaller, targeted steps could make a difference as well. Among them:

Expanding access to community college. These two-year institutions are a powerful means of providing young people with skills that improve their marketability. Last year, President Obama set a goal of graduating an additional 5 million people from community colleges by 2020 and to that end has sought $12 billion in increased funding; Congress recently approved $2 billion in grants as a down payment on that figure. Experts caution, however, that for community colleges to fulfill expectations, they must ensure that their programs are tied to hiring needs in the local workforce--and they must also improve their record on guiding students through to completion. Federal data show that fewer than three in 10 community college students who enrolled in 2004 had received degrees by the summer of 2007. "We believe [community colleges] are one of the smartest investments we can make," says Melody Barnes, the chief White House domestic policy adviser. "But in doing so, we also feel that it is important to make sure that they are matching their programs to the needs of students today."

Helping students manage the burden of debt. With two-thirds of students now graduating with debts, Obama recently won congressional approval for a significant expansion in federal Pell Grants, as well as reforms in student loan programs that will limit repayments to 10 percent of a student's discretionary income after 2014. But policy makers also need to explore more carefully ways to break the link between expanded student aid and rising tuition--such as proposals from congressional Republicans to limit federal subsidies for schools that raise costs too rapidly.

Broadening internship opportunities. College placement officials agree that employers increasingly expect graduating students to have acquired experience through internships. But because most internships offer little or no pay, low-income students who must earn money either to help meet their family's bills or fund their educations often can't afford to pursue them, which leaves these students disadvantaged in the job hunt after graduation. In a recent study, the liberal think-tank Demos argued that to even the playing field, Washington should provide grants to subsidize internships for low-income students. House Education and Labor Committee Chairman George Miller, D-Calif., recently proposed $500 million in government-funded apprenticeships that could serve a similar function, although with federal deficits gaping, the idea's prospects are uncertain.

Providing more chances to serve. Michigan State's Gardner says that his strongest advice to young people unable to find work is "to find an issue and get involved in it" through volunteering. Nationally, he says, one of the best ways to respond to youth unemployment would be "to expand opportunities for service." To this end, last year Obama proposed and Congress approved legislation that will more than triple the size of AmeriCorps by 2017. Other pending proposals would enlarge public service alternatives such as the Peace Corps.

Updating the safety net for freelance workers. The American social safety net delivers most of its benefits, such as pensions and health care, through the workplace. But that model may be increasingly obsolete for Millennials, given a job environment where so many move back and forth between contract and conventional employment, notes Sara Horowitz, founder of the Freelancers Union, which advocates for freelance workers. Health care reform moved the nation toward accommodating this new reality by creating exchanges and federal subsidies that will make it easier for the self-employed to obtain coverage. But Washington has only just begun rethinking how to provide security to a more fluid workforce.

Perhaps the one sure thing is that the Millennials themselves, as they assume growing responsibility in public and private institutions, will increasingly shape the debate over how to provide opportunity and security for America's rising generations. Few of them seem daunted by that prospect; indeed, many in this enormous, civically oriented, politically engaged generation appear impatient to place their stamp on society. The most farsighted and ambitious among them see the recession that has raged across the economy as something akin to a forest fire that leaves terrible damage in its wake but cultivates new growth by clearing away obstructions. "Recessions are moments of realignment where everyone realizes the way people have been producing work and making money has broken down somehow and it's time to retool," says Julienne Alexander, another partner in Washington's Steadfast Associates. "We want to be a part of that retooling by giving smart, creative youngsters a place to do both commercial and creative work." With luck, this generation's efforts may someday be seen as seedlings on a charred forest floor--the first step toward regeneration after a season of fearsome loss.

For more on Millennials and the recession see:
Derek Thompson: "Chasing Their Dreams, by Necessity"
Amy Harder: "It Looks Up From Here"

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