Youth Unemployment

A hard hitting NY Times Op-Ed published today draws out some parallels between the Egyptian situation and our own. Here are some choice snippets...

"About one-fourth of Egyptian workers under 25 are unemployed, a statistic that is often cited as a reason for the revolution there. In the United States, the Bureau of Labor Statistics reported in January an official unemployment rate of 21 percent for workers ages 16 to 24."

"As governments across the developed world balance their budgets, I fear that the young will bear the brunt of the pain: taxes on workers will be raised and spending on education will be cut while mortgage subsidies and entitlements for the elderly are untouchable. At least the Saudis and Kuwaitis are trying to bribe their younger subjects."

What is to be done?

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Originally Posted by caleb

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What is to be done?

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F-me, I dont know. Just know that I'm one of them, not unemployed, but underemployed-graduate degree scanning groceries.

As I get closer to the time of retirement I am glad that I am not just now starting out. Talking to friends with kids graduating college it is scarey. The American Dream was alive and well when I entered the market. Not so much now.

No solutions but I share your concerns.

Mike

I don't think the unemployment/underemployment is going to be chronic. Lots of highly paid workers will retire as soon as their portfolios come back and they feel financially stable again. That's going to open up a bunch of good jobs for middle level people to move up and make vacancies at the lower rungs of good employment.

What does worry me, though, is seeing good jobs turned into so-so jobs. For example, a friend of mine came back from living abroad three years ago and couldn't find work. He took a position filling orders in a warehouse. Pretty soon he was second in command at the warehouse, in charge of the second shift. He was making $30k and his boss, a VP of the smallish company, was making $95k. The president gets to know my buddy and is impressed by him at the same time that the current VP is not impressing him so much. VP gets the boot, my buddy gets his job. Cool, right? Kind of. The president demoted the position to middling status and assigned it a salary of $45k. So a job paying $95k got turned into a $45k job without much change in the responsibilities.

My biggest fear about the employment market is that when jobs start opening up due to retirements budget managers are going to look at them as opportunities to cut costs, turning good jobs into so-so jobs with the aggregate effect of repressing wages for white collar work for the long term. In an environment where most people have fixed and escalating financial commitments/liabilities (mortgage, car, property tax, etcetera) the lack of wage growth could be a big problem.

reminds me of this funny scene...YouTube - Caddyshack- Ditch Diggers

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Originally Posted by Britishbane

not unemployed, but underemployed-graduate degree

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I'm with you. Since companies generally don't think long-term anymore, they tend to only hire people with experience. Then you're in the "chicken or the egg" cycle.

I think corporate culture has changed as well. There was a time when someone would work for a company for an extended period of time due to company loyalty. Come to work, work hard and your boss would take care of you. Work harder than the rest and you're rewarded. The only option I have for promotion in my field is to leave my job for somewhere else. This is really too bad...I would love to work for a company that would invest in me in the same way I invest myself in my job.

option 1: spend 60k to get a degree so you can hope to make 40k/yr in a highly cut throat job market
option 2: apprentice as a plumber/electrician/carpenter for a few years and make 40k+/yr in a good job market with no student loans to pay off

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Originally Posted by edoz

option 1: spend 60k to get a degree so you can hope to make 40k/yr in a highly cut throat job market
option 2: apprentice as a plumber/electrician/carpenter for a few years and make 40k+/yr in a good job market with no student loans to pay off

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This is a great idea...if your school district supports it. VoTech was nonexistant when I went to school. I always had my heart set on working for Porsche but things never worked out. Hell, I even speak German fluently.

seems to me, most want a position instead of the opportunity to build a career. cream alway rises to the top. if your current employer wont pay fair market value, chances are the competitors will (or your not worth what you think you are in that industry). supply/demand........same as it ever was...............

i come from the background where you choose a profession and work your ass off. i don't stress that there are tons of people out there makes WAY more for WAY less effort. my arrangement is with my boss. if that arrangement no longer works for him, he can fire me. if that arrangement no longer works for me, i can fire him.

cheers,
shaner

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Originally Posted by quickag

This is a great idea...if your school district supports it. VoTech was nonexistant when I went to school. I always had my heart set on working for Porsche but things never worked out. Hell, I even speak German fluently.

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Yeah, unfortunately you're right about vo-tech. Schools are cutting back their programs (along with phys ed) cause they think everyone needs to go to college. Private tech schools are popping up all over, but there again you're dropping several grand for just enough training to get your first job. You can still do it the old fashioned way, there are plenty of places that still hire clueless kids and turn them into craftsmen. Btw, has Don Ferris filled that job opening yet?

I started a plumbing apprenticeship when I was 16, started my own business at 21, toiled as Dazza would say for nearly 30 years, wouldn't have changed it but it certainly wasn't all beer and skittles. Grew to hate it, not the work, just the bullshit and walls authorities put in front of us everyday, some fresh college educated kid telling me, having years of real life practical experience how I should be doing my job. Just because you have credentials doesn't make you an expert, I would rather see more on the job training with real life experience backed up with theoretical study. Big catch 22 in today's society is you can't get a foot in the door without the letters behind your name, generally bringing nothing to the table except those said letters.
Bill

The under- and unemployed figures are a joke; the real numbers are unfortunately much higher. The subprime mortgage collapse was the first tremor - not the quake itself. There are several bubbles left to pop, think about those kids with $200,000 in non-dischargeable student loan debt and a degree in Renaissance Studies from your local 1,200 student liberal arts school.

It's a bad time to be an unsecured creditor, and not much better to be secured. At least the debtors can look forward to some inflation to help erase some of their load.

Sic transit gloria mundi.

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Originally Posted by edoz

option 1: spend 60k to get a degree so you can hope to make 40k/yr in a highly cut throat job market
option 2: apprentice as a plumber/electrician/carpenter for a few years and make 40k+/yr in a good job market with no student loans to pay off

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One downside is that lots of guys don't make it to 65 working every day with their hands. Their backs, shoulders, knees, etcetera "go" and they find themselves collecting disability at 55. Someone in a non-physical occupation can often work 10-15 years more.

The problem with apprenticeships today is finding one. Most unions and some trade schools aren't haven't been accepting applications in the states for the past few years.

As far as university kids go, I feel you should have to hold a regular job for a couple of years prior to entering education programs. Doesn't matter what. Grocery bagger, pit lube guy, bike builder... who cares. There is so much to learn from working at even the crappiest job that you're simply not going to get in school. What happened to kids having night/ weekend jobs in high school?

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Originally Posted by whale_spout

The problem with apprenticeships today is finding one. Most unions and some trade schools aren't haven't been accepting applications in the states for the past few years.

As far as university kids go, I feel you should have to hold a regular job for a couple of years prior to entering education programs. Doesn't matter what. Grocery bagger, pit lube guy, bike builder... who cares. There is so much to learn from working at even the crappiest job that you're simply not going to get in school. What happened to kids having night/ weekend jobs in high school?

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My son thinks that because he's going to college 18 hours a week he shouldn't have to get a job, "I'm studying ..... hey dad can you lend me some money? " Where the hell did I go wrong.
Trade apprentices here in Australia are drying up because there are no incentives for employers to take one on, by the time you train them and they start to pay their way, there's a good chance they'll leave and start up as your opposition. The bottom line with any employee is to make money out of them, if they are only there to get through the extra work you may as well just cut your bad clients and save yourself the headaches.
I'm starting to sound like one of those grumpy old men.
Bill

I believe unions, gov't and a rising world have chased away industry from within our borders, and while we enjoyed the fruits of our parents labor, unfortunately our children and our childrens children are now set to "enjoy" ours. I visited with my son in law last night and we had a similar conversation. Unless we, at this crossroad we are at, make dramatic and painful steps now, it is only a matter of time. And I am not gloom and doom, it is not my nature.

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Originally Posted by quickag

This is a great idea...if your school district supports it. VoTech was nonexistant when I went to school. I always had my heart set on working for Porsche but things never worked out. Hell, I even speak German fluently.

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Let me out your mind at ease. I have an engineer friend who worked for Porsche and hated it. Said he couldn't get away fast enough.

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Originally Posted by Britishbane

Let me out your mind at ease. I have an engineer friend who worked for Porsche and hated it. Said he couldn't get away fast enough.

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Is it the culture of the workplace they disliked or the industry? When I lived in Ohio, I knew a few engineers for Honda and they all loved it. Also ... they were Japanese - not that it matters, but maybe working for a company overseas owned by your own people is more rewarding?

Regarding the whole getting out of college and finding a corporate job - I'm trying to find the article about Harvard grads. They find its much easier to create a job/company on your own rather than going to work for someone and they have a pretty good success rate. Granted, I'm sure this mentality is planted in them from the time they are young, but an entrepreneurial spirit is a great thing to have.

For the unemployment - I am seeing this happen in Brazil as well. Kids are going to school until they are 24 years old and coming out unable to find jobs. Many of the good jobs are with government run corporations and once you are in - you are in for life, but the positions rarely open. 1/2 of my wife's cousins have law degrees but are working at clothing stores because they can't get a job in the judicial system. The kids that are "succeeding" have gotten technical (IT) degrees and are working on contract jobs for Motorola, IBM and HP. But my Brother-in-law is a manager of his team/project and doesn't even make enough to support himself there when he could have the same job here and make $60K.

There's something to be said for living longer. Hell, it's far better than the alternative.

But it does mean less attrition in the workplace. That's okay in an ever-expanding economy. Unfortunately there's no such thing. People who, ten years ago, believed they'd retire in 2011 are finding they can't, or would prefer not to given the uncertainty the world faces. That's a spot a younger, less experienced person can't have. White collar jobs can be brutal in this way; most seventy year olds can do my taxes just fine, take a deposition just fine (better, probably), and extract a tooth just fine. Some of these sick bastards even - gasp - enjoy their work, and it's not about money at all.

Folks under forty need to understand something: you're not going to "retire," at least not in the way we've known it for the last century. The bad news is those commericals with the grey-haired couples in bathtubs on beaches in the Caribbean don't, and won't, apply to you. The good news is your financial advisor is useless - the fact that you're half a million dollars in debt to Ivy U. for the six degrees you've had to rack up to get a job doesn't matter. At 35 or so, you've got at least 45 years left in the workplace. And in 45 years, that half million bucks won't buy a used Camry. It's all going to be okay.

Unless you get sick and survive.

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Originally Posted by velobran

Is it the culture of the workplace they disliked or the industry? When I lived in Ohio, I knew a few engineers for Honda and they all loved it. Also ... they were Japanese - not that it matters, but maybe working for a company overseas owned by your own people is more rewarding?

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It was the culture of the workplace and more specifically the people he worked with (i.e. other engineers). For all intents and purposes my friend is Germanic, no idea whether or not that played a role.

He did say that there were track days in which they could go drive Porsche's as hard and fast as they wanted.....now THAT sounds awesome.