Author Topic: Why millennials canít start their careers and baby boomers canít end theirs.  (Read 3103 times)

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Offline zman

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Itís hard to say this spring whether itís more difficult for the class of 2011 to enter the labor force or for the class of 1967 to leave it.

Students now finishing their schoolingóthe class of 2011óare confronting a youth unemployment rate above 17 percent. The problem is compounding itself as those collecting high school or college degrees jostle for jobs with recent graduates still lacking steady work. ďThe biggest problem they face is, they are still competing with the class of 2010, 2009, and 2008,Ē says Matthew Segal, cofounder of Our Time, an advocacy group for young people.

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At the other end, millions of graying baby boomersóthe class of 1967óare working longer than they intended because the financial meltdown vaporized the value of their homes and 401(k) plans. For every member of the millennial generation frustrated that she canít start a career, there may be a baby boomer frustrated that he canít end one.

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Since December 2006, the employment-to-population rate for young people has fallen by a dizzying 10 percentage points, from about 55 percent to just 45 percent. That decline, much sharper than in previous recessions, has reduced the share of employed young people to the lowest levels in 60 years.

By contrast, the employment-to-population rate for older Americans is slightly higher today (37.6 percent) than it was in December 2006 (37.4 percent). During the long slowdown, no other age group has increased its labor-force participation, notes Heidi Shierholz, an economist at the liberal Economic Policy Institute.

Together, these twin trends have produced an economy in which the oldest workers are now nearly as likely to be employed as the youngest. From January 1948 through September 2009, the labor-force-participation rate of older Americans came within 8 percentage points of the rate among younger people in only one month. Since October 2009, the difference between the two groups has been 8 percentage points or less in every month. One side canít start working; the other canít stop.

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These labor-market trends might be viewed as complementary or even as a benign opportunity for Americans to space out their work life over a different spanófrom 24 to 68, say, instead of 21 to 65. After all, as life expectancies lengthen, the U.S. canít afford its social-safety net without extending the retirement age. But that would require a systematic effort to help young people use their early 20s to expand their skills and experiences. Thatís not happening.

Instead, what economists call the idleness rate is rising: The share of Americans younger than 24 neither at work nor in school has steadily increased since 2007. That disconnection creates the risk of what Harvard University labor economist Lawrence Katz calls ďa lost generation.Ē

Faster overall job growth would be the best antidote to that threat. But the particular problems of young people demand more-targeted responses. Colleges and universities must see to it that more students donít just start their degrees but also complete them. As Segal says, those institutions must also accept ďgreater responsibility to ensureĒ that those graduates leave with skills employers need. Washington, meanwhile, should consider further expansion of AmeriCorps and other service opportunities for this civic-minded generation.

Above all, the class of 1967, which is growing reflexively hostile to government spending, needs to realize the interest it shares with the class of 2011: Unless todayís young people ascend into well-paying jobs, it wonít be possible to finance Social Security and Medicare for tomorrowís seniors.

The full article can be found at http://www.nationaljournal.com/columns/political-connections/our-upside-down-workforce-20110609

This is not a good situation for anyone, but what can be done?  :-\

Offline Sal Atticum

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Thankfully an article that doesn't lump the class of 2005 into "millennials."

I wish I knew what could be done.  Off the top of my head, reforming healthcare, if done properly, would make it easier/cheaper to hire more people at each business, allowing everyone more flexibility of schedule due to the greater number of employees, resulting in a more solid business (always someone available to work), but it would also mean potentially fewer hours for each person.  Still, a job is a job at some point.

Makes me wonder as well, if you don't worry about healthcare, how much does it cost per employee to "hire" someone? 
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Offline pmp6nl

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I wonder how much of an issue this has always been.  By that I mean what percentage of people has their always been that cannot retire because they don't have the savings?  Since there is now a greater focus on saving money for retirement you would think the percent of cases like this would decrease.

Is there a solution to the current issue?  I don't think so, unless perhaps we do something really radical.  The lack of jobs for those graduating is going to have a long term negative impact on them and the economy.  Will this lead to a bigger issue down the road?  Is anyone even concerned about this -- in that someone is trying to figure out what to do?

I realize I am asking a lot of questions and not providing any answers.  But something to start pondering.
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Offline Sal Atticum

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In completely unrelated news . . . I think North Dakota has one of the highest success rates for small businesses.  Just sayin', for people who are having horrible luck finding jobs.
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Offline pmp6nl

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In completely unrelated news . . . I think North Dakota has one of the highest success rates for small businesses.  Just sayin', for people who are having horrible luck finding jobs.

Why do you suppose they have such a high success rate?  Low taxes, available resources, incubators, etc.?
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Offline Sal Atticum

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In completely unrelated news . . . I think North Dakota has one of the highest success rates for small businesses.  Just sayin', for people who are having horrible luck finding jobs.

Why do you suppose they have such a high success rate?  Low taxes, available resources, incubators, etc.?

You've got me.  Off the top of my head it might be general aversion to risk, and so with fewer businesses getting started, there are fewer to fail (and only the sure bets get started).
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Offline pmp6nl

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Makes sense.
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