Class of 2020 could struggle to find work as jobs are vaporized
Nileidy De la Cruz had a plan for her life after she graduates from Syracuse University next month: Move back home with her parents in New York City, land a video production internship at the website Buzzfeed and work like crazy to turn that entry-level role into full-time employment.
The 22-year-old Bronx resident still plans to move home, but now she's waiting until July to begin searching for jobs. De la Cruz is like millions of college students who are graduating just as the coronavirus pandemic lays waste to the U.S. labor market. Economists are predicting the nation's unemployment rate, which recently hovered near a 50-year low, will suddenly shoot into double-digits in April and May as businesses shutter and Americans stay-in-place for weeks and perhaps months.
Graduation is still a few weeks away, but De la Cruz said she and her classmates already realize "our senior year has been pretty hard."
"I didn't think (coronavirus) would affect anything, but then I started feeling it more when March hit," De la Cruz said. "My parents are not working and none of my family is working."
The coronavirus has sent millions of workers marching to the unemployment line just as college students were ready to land their first jobs. If Americans remain out of work for much of 2020, economists say it would send the nation deeper into an already existing recession that would hurt De la Cruz and her classmates for years to come.
"Should a recession occur, we believe young workers and new grads may be hit hard," University of Tennessee economists Celeste Carruthers, Larry Kessler and Marianne Wanamaker predicted in a recent research paper. "Younger workers typically have more trouble finding and maintaining employment in a recession."
When the fall semester began, the class of 2020 was expecting to graduate at an opportune time. By February, as resumes often get a final polishing, the unemployment rate was holding steady at 3.5%. And many states had increased their minimum wages in January — good news for the many spring grads who must wait tables or fold shirts at Old Navy while they seek their first jobs in their chosen fields.
But the rapid spread of the coronavirus has turned those expectations upside down. COVID-19 already has killed nearly 5,000 people in the U.S. Schools across the country have canceled graduation ceremonies. Large and small employers alike have been laying off workers or announcing hiring freezes. America's unemployment rate could hit a staggering 30% by June, according to James Bullard, president of the St. Louis Federal Reserve Bank.
Even after the federal government rushed to pass a $2 trillion stimulus package, many college students found themselves on the short list of Americans who can't get the $1,200 stimulus checks if they are claimed as dependents by another taxpayer.
The Tennessee researchers said a sharp economic downturn can hurt not only college grads' wallets today, but also their long-term health and earnings prospects. People trying to enter the labor market during a recession can go longer without employer-provided health coverage, "potentially leaving both their physical and financial well-being at greater risk," they said.
A Yale University study found that U.S. college students who graduated during a recession earned 10% less in wages during their first working year than what they would otherwise get. Those negative effects could last over the following seven years, the Tennessee researchers said, lowering their annual pay and future raises and even how much money they can start socking away for retirement.
Greg Willard, a computer science senior at Florida Polytechnic University, said the university gave seniors three alternatives for graduation: an online commencement in May, an in-person ceremony in December or an in-person graduation in May 2021. Willard, 21, said he picked the December option, but really wanted to don a cap and gown next month.
"I was looking forward to it, but given the situation I understand that it's something that reasonably can't happen," he said.
Jazmyn Bradford, 21, a senior at Michigan State University, said the pandemic changed her post-graduation plans. Bradford said her professors advised her last fall to find work immediately after graduation. She considered it, but as the coronavirus spread Bradford said she had "to think more realistically — like, is it even smart for me to go into the working field right now?"
She ultimately decided against trying to land a job and will enroll in graduate school this fall. "A lot of us graduating seniors weren't ready for this," said Bradford, a social work major. "We weren't built for this. We're losing jobs, and there's not that many opportunities for us anymore."