Left Behind

Lost in the economic recovery

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Continued: New workers are starting behind and can't get ahead

  • Article by: ADAM BELZ , Star Tribune
  • Last update: March 9, 2014 - 10:46 PM

Bad timing

Since 2008, first-time job seekers have faced a market more difficult than anything their older siblings or parents have seen.

Unemployment for people under 25 hit 21 percent in 2010 and still is well above its prerecession high at 15.6 percent, according to the Bureau of Labor Statistics. The situation is worse for workers under 25 with no college education, whose unemployment rate is 18.6 percent.

Young people who are working have fewer opportunities for advancement, in part because fewer older workers are voluntarily quitting their jobs.

“The longer this goes on, and the longer they’re not attached to something meaningful — and there’s a lot of young people who still aren’t — then they’re wasting their human resource investment, which is their education,” said Phil Gardner, director of the Collegiate Employment Research Institute at Michigan State University.

Repeated studies show that people who look for their first job during a recession take as much as a 9 percent wage cut. These losses can be permanent, and even when they’re not, may fade only after a decade.

The fault lines run through families.

Laura Franklin, 27, and her sister Emily, 32, both went to the College of St. Benedict in St. Joseph, Minn. Emily didn’t seriously consider her career until her senior year, yet got a good job four days after she graduated in 2004. Laura, with a 3.9 GPA and a semester as a full-time substitute teacher under her belt, couldn’t crack the teaching market in 2009 or 2010.

She wanted to teach third-graders, she said, because they like to learn and are old enough to work independently. She applied for more than 100 jobs in Minnesota and Colorado through the summer of 2009. She drove to job fairs where lines formed out the door for one opening. “You’d just hang your head when you walked in,” she said.

The first few weeks without a job offer turned into months, and then the summer passed, and her computer filled with folders of rejected cover letters.

“I was just so defeated,” she said. “My self-esteem was just blown. I said, ‘I give up. I’m going to take care of babies. This is my life. OK.’ ”

She worked at a day care called New Horizon Academy, and a year later, took a job as an early childhood teaching assistant for St. Paul public schools, hoping that might lead to full-time teaching. She worked both jobs — 12 hours a day — to cover her bills, including payments on $18,000 in student debt.

The teaching job never materialized, so she took a job at a UnitedHealth call center, which led to a better position at OptumHealth. She gave up hopes of teaching but believes those years made her stronger.

“I can look back and think OK that was awful and such a hard struggle, but I’m so happy with where I am now because of it,” she said. “It makes you appreciate it that much more.”

One reason for optimism is that as more baby boomers leave the workforce, more jobs should open up for younger workers.

About 57,000 Minnesotans are turning 65 in 2014, and about 31,000 of them are still in the labor force, said Susan Brower, Minnesota’s state demographer.

The biggest cohort of baby boomers is now in its mid-50s, so Brower expects the number of retirements to rise over the next 10 to 15 years.

“We do expect to get this boost in terms of replacement job openings,” Brower said. “We don’t know exactly what the size of it will be.”

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