The job market for young Americans has become increasingly difficult, despite a seemingly strong economy. Many recent graduates are facing challenges in securing employment, which could have long-lasting impacts on their careers and earnings. This article explores the reasons behind the struggles of young job seekers and the economic trends contributing to the issue.
A Challenging Job Market for Recent Graduates
For young Americans like Kirsten Staple, finding a job has been an uphill battle. With a psychology degree from the University of Texas at San Antonio, Staple has applied for over 500 positions in her field and beyond, yet she remains unemployed. Living with her parents in El Paso, Texas, Staple represents a growing number of young people who are struggling to kick-start their careers.
Despite the broader US economy showing positive signs, such as low unemployment and a high number of job openings, younger workers are having a harder time. Data shows that in September 2024, the share of workers aged 20-24 in the labor market saw the largest decline of any age group. Additionally, the percentage of job seekers aged 18-24 who spent more than a year looking for a job tripled compared to the previous year, according to ZipRecruiter.
The Long-Term Impact of Early Career Setbacks
Economists warn that these early setbacks can lead to long-term consequences for young workers. Missing out on the first few years of a career can result in lower lifetime earnings and fewer opportunities to develop key skills. Building a professional network is also a critical part of early career growth, and setbacks in this phase can hinder long-term success.
The Rise of ‘The Great Stay’
In 2022, job openings reached record highs, and workers were quitting at historically high rates, confident that they could find better opportunities. However, two years later, the labor market has slowed significantly due to rising interest rates from the Federal Reserve, which aimed to control inflation. This slowdown in hiring has been dubbed ‘The Great Stay’ by economists.
Julia Pollak, chief economist at ZipRecruiter, explains that while overall employment numbers look strong, actual hiring and job-switching activity have slowed drastically. In August 2024, the rate of new hires dropped to the lowest level since 2013, and fewer workers are quitting their jobs, a trend not seen since 2015. Companies are hesitant to hire due to economic uncertainty and upcoming US elections, leaving young job seekers in limbo.
Economic Uncertainty and Its Impact on Hiring
Employers are holding off on hiring due to uncertainty about the economy and the outcome of the 2024 US presidential election. Higher interest rates also contribute to companies delaying hiring decisions, making it harder for young graduates like Jonathon Courtney, who holds a master’s degree in applied economics from the University of Houston. Despite applying for 200 jobs, Courtney has only secured five interviews.
Lasting Effects of Career Delays
Young workers missing out on early career opportunities may face lasting financial consequences. Daniel Zhao, lead economist at Glassdoor, points out that Millennials who graduated during the Great Recession were similarly affected and often ended up stuck in jobs that didn’t pay market rates due to job security concerns. This lack of job-switching can lead to workers staying in roles that are not ideal for long-term career growth.
Emotional Toll of Job Market Struggles
Even those who have started their careers are not immune to setbacks. Catherine Dugoni, 26, lost her public relations job a year ago and, despite applying for hundreds of jobs and participating in 60 interviews, remains unemployed. The emotional toll of the job search has been significant, and Dugoni was forced to move back in with her parents in Sacramento, California, after struggling to afford rent in San Francisco.
Conclusion: The Future for Young Job Seekers
The current economic climate has made it difficult for young Americans to launch their careers, with many facing long-term impacts from early job market struggles. As companies continue to delay hiring due to uncertainty and economic trends, young workers like Staple, Courtney, and Dugoni find themselves caught in a challenging situation, with long-lasting effects on their professional futures.
