NH young people face job woes even in better economy
Ciccarello expects to graduate from the New Hampshire Technical Institute in Concord this spring with an associate's degree in nursing. While in school, he holds down a part-time job as an EMT with American Medical Response in Manchester.
Carlisle, a sophomore at Yale majoring in math and computer science, worked last summer for a startup, helping to write code that was used to build a constituent contact service for politicians or businesses.
Both young men are doing exactly what all the experts say they should be doing to improve their prospects for meaningful employment after graduation. They are majoring in degrees that are supposed to be in demand. They have internships or part-time jobs in their chosen fields. They are aggressively networking with peers and prospective employers.
They should be optimistic, but they are worried about what they see around them - older family members or friends with good degrees and experience stuck in low-paying, dead-end jobs, or no job at all, living with their parents well into their mid-20s, frustrated by the worst job market for youth since the years following World War II.
There are signs that conditions may be improving for Millennials (18- to 29-year-olds), also known as Generation Y, the children of the baby boomers. A recent study by the Boston-based Millennial Branding research firm reported that 87 percent of employers expect to step up hiring of new grads in the months ahead. But it might take years before hiring returns to pre-recession levels.
Meanwhile, the unemployment rate for Millennials is higher than for any other age group in the work force, both nationally and in New Hampshire.
Crunching the numbers
Generation Opportunity, a national organization advocating for Millennials, recently released its Millennial Jobs Report for November.
"We do a crunch on the numbers released by the Department of Labor," said Matt Faraci, senior vice president for communications at Generation Opportunity. "We do a specific 18-29 cut on the overall unemployment number, and what we saw last month was 10.9 percent."
That compares with a national unemployment rate in November of 7.7 percent, the lowest since December 2008. New Hampshire's seasonally adjusted unemployment rate for October was 5.7 percent, better than the national average.
Millennials in New Hampshire, however, are not doing much better than their peers nationally.
Annette Nielsen, an economist with New Hampshire Employment Security, analyzed the unemployment data to extract a rate for 18- to 29-year-olds on a 12-month average ending in October and found the New Hampshire jobless rate for Millennials at 9.4 percent, much higher than the overall rate for the state.
"We are substantially better overall," said Nielsen, "but for youth, it's not that much better here."
Nielsen suggested that the decline in layoffs has helped the overall rate, but new jobs are not being created fast enough to accommodate new entries into the work force. "There has not been a lot of new hiring, and young people need hiring to be up to get jobs."
Also hurting prospects for youth is the lack of turnover, or what Nielsen called "churn," in the workplace. Unable to afford retirement, older workers are holding onto their jobs longer. Both Nielsen and Faraci agree that the actual percentage of young people unemployed is probably much higher because many have simply given up looking for work and therefore are not counted in the statistics.
An ongoing trend
The trend of young people taking longer to leave the nest was building long before the Great Recession struck at the end of 2008. In 1993, a survey by the Pew Research Center reported that 80 percent of parents responding cited 22 as the age of financial independence. More recent surveys put that figure closer to 25.
The most recent study from Pew, released on Dec. 14, suggests that nearly half of America's youngest adults - 40 percent of those ages 18 to 24 - have never moved out of their parents' home.
"Parents are being realistic about the economic environment into which their children are being thrust," said Faraci.
The statistics mirror the anecdotal evidence that young people such as Ciccarello and Carlisle see around them.
"I have a whole bunch of friends who were seniors last year and graduated," said Carlisle. "One is going to have a very good job, but another is completely unemployed. He graduated from Yale with a degree in history and can't find work. That's the kind of scary situation that I see more and more. A college degree - even an Ivy League college degree - doesn't guarantee you, or give a specific road for, success."
Ciccarello finds it sobering that his classes at NHTI are filled with Generation X students or even baby boomers trying to restore some economic stability in their lives.
"It's interesting to see the number of people who are getting a second education, single moms trying to get back into the work force to pay some of the bills, people struggling to get through school who are a little older then me," he said. "It's shocking to me to see how many people are in that situation."
Even if things turn around, a generation of young American workers may suffer for the rest of their lives from the effect of the recession through what Faraci called "wage scar," citing a 2005 study that showed youth unemployment has an effect that can persist into middle age. The longer the period of unemployment, the bigger the effect, he said.
The study showed that if you take two men with all factors being equal - same education, literacy, residence, parents' education and IQ - and one of them spends a year unemployed before the age of 23, 10 years later, he can expect to earn 23 percent less than the other man. For women, the gap is 16 percent.
"If you get that first entry-level job at whatever salary it is when you are 22, by the time you are 25, you can expect to be making more money," he said. "But if you don't get that first job until you are 25, you are already behind on your wage potential."
Young people are finding that it takes longer to enter the work force, and when they do, they are often making lower wages than they might have made five years ago, even further compounding the long-term effect on their lifetime earning potential, Faraci said.
Job market changing
When hiring finally does pick up, the Millennials have a lot to offer in an economy that will need innovative and entrepreneurial employees in the future.
"The whole job market is changing, from the traditionalist model to one that is fueled by entrepreneurial, creative and innovative thought. That's what we're seeing in New Hampshire," said Jamie Coughlin, CEO of the abi Innovation Hub, a business incubator in Manchester that has given many young entrepreneurs a leg up.
"There are more young people starting businesses, thinking about freelancing or other types of self-employment as a career, and realizing those are viable opportunities," he said.
Joe Weinlick, vice president of marketing for Beyond.com, a job-search and networking website, is seeing an increase in job postings nationally and cites trends that suggest hiring is headed in the right direction.
"I think going into next year, we are going to see more job growth, especially in entry-level jobs," he said. "And the one thing young people have going for them is that the employers are looking for a tech-savvy employee who can move very naturally into those positions when hiring picks up."
Beyond.com partnered with Millennial Branding on a survey titled "Multi-Generational Job Search," released in September. "We found the Millennials were frustrated, but not despaired," said Weinlick. "They are still fresh and have their whole life ahead of them, as opposed to a boomer, who didn't expect to be in this situation at this point in life."
Ciccarello describes himself as cautiously optimistic.
"There are certainly more options for me than for other people," he said, "but that doesn't make it easy. I'm in one of the best positions for my generation and have had a hard time getting an internship. I can't imagine what it looks like for the rest of my generation right now, and that's what scares me."
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Dave Solomon may be reached at email@example.com...