Samantha McCloud, 16, left, Victoria Garcia, 16, Jessel Rincon, 16, at the College and Career Fair at Temple City High School on Saturday, October 21, 2023 in Temple City, CA.
Irfan Khan | Los Angeles Times | Getty Images
After graduating from college, Julianna Larock was bombarded with news about the strong job market and the high demand for skilled workers.
But that wasn’t her reality.
Instead, she spent countless hours browsing networking sites like LinkedIn, attending mixers and other professional events, and generally scanning the entire workplace for something that would fit her desire to get a job in finance. All without success.
“Honestly, it was pretty brutal,” says Larock, 25, from Wilmington, Delaware, and now living in New York City. “It felt like a lot of work for little response and little reward.”
Luckily, after a year of struggling with dashed hopes and slogging through some contract work to get by, Larock found full-time work as an executive assistant and research associate at Acumen, a nonprofit impact investment firm in New York. The company was founded by Jacqueline Novogratz, the sister of prominent investor Michael Novogratz, the CEO of crypto-focused Galaxy Investment Partners.
Julianna La Rock
Courtesy: Julianna LaRock
While Larock is happy with her current station, the path to get there has been difficult and the future feels uncertain.
“The depression and anxiety that accompanied the job search often affected many of my other social relationships,” says the University of Delaware and Fordham graduate. “People can only be so supportive, and you just felt like every day was the same. And I really hate monotony.”
Larock’s experience comes at a time when the job market is evolving, at least on the surface.
Signs of weakness
Since the beginning of 2023, the number of non-farm payrolls has increased by about 4 million, continuing the growth that began after the Covid crisis. The unemployment rate has been below 4% every month since January 2022, an increase not seen since the 1960s.
But there is growing concern that the labor market is developing cracks. Larock’s group of workers — in their late teens and early 20s, including recent college graduates and other young professionals — appear to be particularly at risk.
According to the Bureau of Labor Statistics, the hiring rate for all workers is 3.6% of the labor force, just below the low point of the post-Covid era. Before the pandemic, the hiring rate was last below current levels in August 2014. Things are getting worse for younger workers.
“Many times people would tell me that the job quality or the job search statistics weren’t all that bad and use that kind of influence to invalidate anything I felt,” Larock says. “Whether that was what they intended or not, and I don’t think it was, that was the impact it had. It made me feel worse.”
Welcome to the job market of good news and bad news, where the collective experience is positive, but for individuals in certain groups, not so much.
“The good news,” Elsie Peng, an economist at Goldman Sachs, said in a recent note, “is that monthly job search rates are at or above rates for groups that are typically more vulnerable to weaker cyclical conditions, including workers without college “Degree, workers in low-skilled sectors and foreign-born workers.”
“But the bad news is that new entrants to the job market are doing less well,” Peng added.
The monthly rate of workers with little work experience finding jobs has fallen to 13% from its previous high of 20%, according to Goldman data. While Peng described the job market as “strong overall,” she said there were “soft vulnerabilities” that particularly affected “new entrants to the workforce.”
While the unemployment rate in the 20-24 age group is 3.5%, it is slightly higher than before the pandemic and is an area to watch for weakness in the labor market.
Molly Huang, a 22-year-old Penn State graduate with a degree in aerospace and aerospace engineering, is also facing the same situation – a process she began while in college and now, has intensified since she no longer goes to school.
“To be completely honest, it’s not a particularly great market. Many people I speak to agree that it is quite difficult for a new graduate to find a full-time job,” says the Horsham, Pennsylvania, resident. “I get interviews here and there, but I never got a concrete offer.”
Huang admits that her degree makes the search a little more difficult, so she is somewhat flexible in her approach.
“I’m trying to be pretty optimistic because a lot of people I know who get jobs don’t start until August, so I feel like I still have a little bit of time,” she said. “But at the same time it feels like the clock is ticking.”
Have the experience
An age-old dilemma that Huang and others in her place must grapple with is the experience dilemma: Employers want to hire those who have a background in their field, which is hard to come by for new graduates outside of internships.
There appears to be some good news on this front.
According to Vanguard, which uses proprietary data from 401(k) program enrollments, the ratio of new hires to existing employees rose to 2.8% in April, the highest level since October 2022.
“In recent months, however, there has been a slight increase in hiring of younger workers, while hiring rates for older workers have been flatter,” said Vanguard investment analyst David Pakula.
At the same time, job site Indeed reports that in April, less than a third of all job postings on the site listed a specific number of years worked, compared to nearly 40% just two years ago. According to Indeed economist Cory Stahle, the reason is more likely a shift toward “skills-first” hiring, which places less emphasis on educational background and more on what potential employees bring to the table.
That’s both good and bad news for younger workers, some of whom had hoped expensive degrees would give them a foothold.
The challenge for younger workers
“The whole job market has really changed a lot since 2021 and 2022, so I think graduates are entering a job market that is much more demanding than in recent years,” said Joanie Bily, chief human resources analyst at Employbridge, an industry recruitment firm .
As for how healthy sales numbers have looked since the 22 million layoffs in the early days of the pandemic, Bily points out that much of the recovery has occurred in healthcare, leisure, hospitality and government positions.
In the finance sector where Julianna Larock works, the unemployment rate is actually higher now than it was before the pandemic – 2.7% compared to 1.7% in February 2020.
Additionally, the balance of household employment has gone to part-time jobs, increasing by more than a million over the past 12 months, while full-time employment has fallen by more than half a million, according to the Bureau of Labor Statistics.
“Although it is still a relatively tight labor market, I think we are seeing a slowdown in the overall U.S. labor market, and we have actually been seeing this decline since 2022,” Bily said. “What we see with graduates is that they want to get into the workforce and start their careers, and many of them are taking jobs even in leisure and hospitality because that’s where the jobs are.”
Ethan Mariano will graduate from Gettysburg College at American University in Washington, DC later this year with a double major in political science and international affairs. He needs a job to support himself while he studies, but would like a job that would serve him well and serve as a springboard to work in foreign policy analysis at the State Department or a think tank.
No luck so far.
“Many jobs say that we need two years of work experience, despite the fact that they are entry-level jobs. Others say you need an internship on Capitol Hill, which is difficult because those who can afford to live down in D.C. get the internships,” says Mariano, 22, of Hazleton, Pennsylvania. “It was difficult.”
Despite the obstacles, he remains optimistic, but still knows he will likely need to earn a postgraduate degree before he can truly establish himself.
“Yes, I am optimistic. Maybe it’s the young naivety in me, but I think I’ll find something,” says Mariano. “I just need to get my foot in the door.”
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2024-06-06 19:38:46
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