Alumni facing tough market

Due to their economic uncertainties and successes at raising productivity with fewer workers, employers across the nation are holding off on hiring, even as the U.S. economy begins regaining some of its composure.

As college students stand on the verge of entering the job market, many ponder the effects such a turbulent and unstable economy might have on their employment opportunities in the near future and whether the mediocrity of their résumé will bear enough substance to attain a job post-Luther.

The U.S. economy expanded at a rate of 3.5 percent in the third quarter of this year, triggering some economists to declare the end of the worst recession since World War II.

However, official confirmation of whether the U.S. is in or out of recession is reserved for the National Bureau of Economic Research, who have, until this point, abstained from giving their opinion on the matter.

One reason why no such declaration has been issued is because a number of economists argue that a 3.5 percent rate of growth is unsustainable, attributing this statistic to an economy saturated with government stimulus programs.

They also cite rising unemployment throughout the country. Just last week the unemployment rate reached a staggering 10.2 percent—the highest it has been in 26 years. What’s more, forecasters predict that this high unemployment will last for years.

But amidst mass layoffs and a slow economy, labor productivity has increased. Those who are working are working harder and longer than they did before.

Economists say that in the long run this rise in productivity is good for companies, workers and the economy because more productive companies have greater profits, which allow them to pay higher wages. That also allows the economy to grow faster without generating inflation.

But these same economists warn that in the short run, stretching existing workers means hiring fewer ones. College students can expect a job market that is more challenging than it has ever been.

According to the National Association of Colleges and Employers’ “Job Outlook 2010 Fall Preview,” which surveyed 219 organizations such as Best Buy Co., Inc., Wells Fargo and Ford Motor Company, “[Employers] plan to hire 6.9 percent fewer graduates in 2009-10 than they hired in 2008-09.”

This drop comes on the heels of the 2008-09 recruiting season, which saw employer hiring plans change almost overnight from a 6.1 percent increase to a decrease of more than 21 percent due to the economic meltdown in the fall of 2008.

Among the employers the NACE interviewed, only 16.9 percent planned on hiring more college graduates than last year, 43.4 percent said they would hire the same number and 39.7 percent said that they would be hiring fewer graduates.

Graduates who are fortunate enough to find jobs can expect lower wages compared to those who graduated some five years ago. This, economists say, is largely because during a recession high-end firms hire fewer people and drive down salaries because jobs are in such demand.

In this economy those with more experience, higher levels of motivation and a focused interest within their field will get
the leg up in today’s economy.