Young, Educated And Unemployed: Part II
MICHEL MARTIN, host:
As everybody knows, the economic crisis has slammed the job market, and the monthly unemployment rate has reached 7.2 percent. That's the highest monthly rate in 16 years. Yesterday, we spoke with a group of recent college graduates who are struggling to get or keep a full time job in their fields. So after hearing about their experiences we decided to turn to our regular money coach, financial adviser Alvin Hall, for more advice. Welcome back, Alvin. Thanks for talking to us.
Mr. ALVIN HALL (Financial Adviser): I'm very glad to be here, and this is a topic that's near to my heart because when I graduated from university in the '70s, it was in the midst of a huge recession.
MARTIN: But before we start, I think it is worth noting that college graduates are still much better positioned in the job market than people with less education, isn't that right?
Mr. HALL: Absolutely. The problem is that they may not be able to get a job directly in their fields. Many of them think that as soon as you get out of school, you have to work in the area in which you have majored. What people need to think about is broadening out their point of view and look at other areas of employment that may support their long-term goals.
MARTIN: Well, let's go to questions from some of the folks we talked to yesterday. One of the struggles that Mimi Wong talked about was, just as you said, finding a job in her field of interest and the role of internships in getting hired. Now, we called her back and she had this question for you. Here it is.
(Soundbite of phone call)
Ms. MIMI WONG (Intern, Television and Film Production): My question is if for some reason I do not get hired at my current internship, is it best for me to look for another internship elsewhere or am I in a position to be able to apply for an entry level job?
MARATIN: And it is worth noting, Alvin, that Mimi is in television and film production, so it's a very specific area.
Mr. HALL: She is more than qualified for an entry level job, and what she needs to do is sort of blanket the market and use her personal contacts to try to get in that job. In television, as in most media, a lot of things are about relationships. So she needs to exploit those relationships in order to get the opportunities.
MARTIN: And I think the fear here is that if you deviate from your field, does it look as though you're not as committed, and does it take you out of that circle of relationships that you were talking about? I think that's the fear.
Mr. HALL: When I came out of university, people often viewed getting a diverse group of experience as a very good thing because it made you more flexible, it showed that you had an elastic intelligence and a wide ranging curiosity. Today people think that you need to be focused, almost like being a technocrat, you need to stick with your area. In reality, everyone who you talk to, who you interview with as a recent graduate, they'll know that the economy is bad. If you've had to take a job to sidestep your career, as long as it's vaguely related or you can bring it back into your long-term goals, they will understand this. And if it's the right job, it could actually benefit you in many ways.
MARTIN: One of out graduates was wondering whether they should be willing to spend something to get something. Another guest from our round table, Kelsey Shwank(ph) asks this question about job placements specialist or head hunters.
(Soundbite of phone call)
Ms. KELSEY SCHWENK (Recent College Graduate): I'm wondering about head hunters, and I've been thinking about contacting one but I don't know if they're any better than searching for a job online or if I'm even qualified to be using one? I hear they're just for executives. So do you have any advice on that?
MARTIN: And that's a good question, Alvin, too. Because there are a lot of people in other fields who wonder whether they should try to find an agent, for example, a representative or some kind of representative. So what's your advice on that?
Mr. HALL: Agents tend to look for people who fit into certain nice little neat pegs on a board. They want you to fit that job so it's easy for you to place them. Some of them will have services that will help you tailor your resume to a job, advise you on an interview. But for most recent college graduates, you should use your school's placement office as the best way to get a job, and then ask them if they have contacts in these areas in which you're interested.
MARTIN: And why do these school placement offices want to help you?
Mr. HALL: They know which graduates work in what industries. They're often people who have given money to the schools, they have an interest in helping graduates from that school, and so often they'll open the doors for you or they'll know somebody that they can refer you to that can help you in your chosen field.
MARTIN: And I bet they also want you to repay those student loans, too.
Mr. Hall: (Laughing) Yes.
MARTIN: That's another incentive for them to be helpful to you. And speaking of those student loans, if young people find themselves unemployed and they owe student loans, what are their options? Is there a possibility to get forbearance or delay the repayment schedule if you are unemployed?
Mr. HALL: They have two options. One, they can ask for a deferment, which basically freezes the loan at that moment. Interest is not being earned on the loan, and you don't have to pay it back until you get a job that will allow you to afford to make the payments. There is also forbearance. Forbearance is a suspension of the payments, but interest continues to accrue on the loan.
MARTIN: What about grad school? Is that an option at a time like this?
Mr. HALL: Yes, if you can get a good package of scholarships, grants, and loans, graduate school is a good thing because during this recession you are actually improving your skills. But what people need to think, graduate school isn't their only option. They can take temp jobs. Sometimes that temp job that seems unrelated to your long-term goal can open a door. So think about things that can support you in other ways long-term.
MARTIN: Finally, any thoughts about kind of long-term planning in this economy. I know you generally have advice for young people starting out in their careers that they should start, you know, saving for their retirement as soon as possible, they should try to keep their credit card debt under control. But I think in days like this, a lot of people feel kind of out of control.
Mr. HALL: Yes.
MARTIN: Are there things that recent grads can do to help them feel like they have more sense of control over their futures?
Mr. HALL: I think they really need to focus on trying to live on the money that they earn without feeling deprived. They need to build-in treats. Build in little indulgences that will help them feel valued as if they are moving forward, as if they are treating themselves well. Also, I tell people, don't always think of the job you're doing as - oh, I should be doing X when this is what I really want to do. If you have a job that's related in some distant way to your ultimate career goal, you can reshape that experience to your benefit long-term, showing that you are intellectually curious, you are flexible, and that you have a skill set of a survivor.
MARTIN: Alvin Hall is our regular contributor on matters of personal finance and he joined us, as always, from our bureau in New York. Alvin, thank you so much.
Mr. HALL: Very glad to be here.
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