By Dylan Alford
If you read the headlines surrounding last week’s unemployment report from the Bureau of Labor Statistics, you might think that the job market is improving. The official government unemployment rate dropped in January to 8.3%, down from 8.5% in December. And the economy added 243,000 jobs. Here’s a sampling of the headlines:
“Unemployment rate falls to 8.3%; fifth straight monthly decline” (LA Times)
“Jobless rate drops to lowest level in almost three years” (MSNBC.com)
“Unemployment rate drops to 8.3 percent” (Christian Science Monitor)
“Hiring surges in January; jobless rate at 8.3 pct.” (Atlanta Journal Constitution)
“Jobless Rate Falls to 8.3%, Altering Face of Campaign” (New York Times)
“Unemployment report: January job gains have economists rethinking outlooks” (Washington Post)
Unemployment Rate Jumps to 10.9%?
Some serious perspective is in order here. What didn’t make the headlines – and was buried much deeper in most of the stories about the report – was exactly how the Bureau of Labor Statistics arrived at the conclusion that fewer people are unemployed now. Since the recession began in 2008, the government has simply stopped counting millions of “long-term unemployed” as part of the workforce.
A recent study by Washington, D.C. consulting firm Hamilton Place Strategies estimates that 3 million long-term unemployed are no longer being counted by the Labor Department because they have simply given up looking for work. If you add those people back, the unemployment rate jumps to 10.9%.
A shrinking proportion of the adult population is considered to be “participating” in the workforce. The labor force participation rate fell in January to 63.7% from 64% in December. That’s the lowest participation rate since January 1982. And total nonfarm payroll employment in January stood at 132.4 million jobs. That’s down from 138 million in January 2008 – 5.6 million fewer jobs.
Gallup, the international research organization, released a different headline for its monthly jobs report: “U.S. Unemployment Up, to 8.6% in January.” Gallup’s polling methodology differs slightly from the Bureau of Labor Statistics, but both measures exclude millions who have given up and stopped looking for work. Gallup also measures underemployment, which counts people who are not working but want a job and those who are working part-time but want full-time work. Underemployment was up in January to 18.7% from 18.3% in December.
243,000 New Jobs?
According to the government’s jobs report, the economy added 243,000 new jobs in January. The biggest job-creating sectors were manufacturing (50,000 new jobs) and leisure and hospitality services (44,000 new jobs). As a recent college grad, you’re probably not too excited about new manufacturing jobs. And even if you are, most of the new jobs in that arena pay less than they did in the past. If you read this article that large U.S. manufacturers, like Ford and General Electric, are keeping jobs in the U.S. or bringing them back from lower-cost destinations overseas. But the catch is, they’re paying new hires $10 to $15 an hour less than the people that were hired just a few years ago. And their wages will never catch up with the generation of workers that came before them.
Leisure and hospitality services, again, are probably not the kinds of jobs that a college grad gets excited about. I doubt you borrowed tens of thousands of dollars and spent the last few years of your life studying to serve drinks for minimum wage plus tips.
College Grads Vulnerable to Long-Term Unemployment
Adding to this already rosy picture is a new Pew Fiscal Analysis Initiative study that shows college graduates who become unemployed are as vulnerable to long-term joblessness as high school dropouts.
More than a third – 35% – of unemployed college graduates have been without a job for more than a year. That’s the same rate as high school dropouts.
According to the Pew report, the percentage of the labor force facing long-term unemployment is at a record high of 2.8%, which adds up to about 4 million people out of work for more than a year.
The way I see it, a recent grad has three options:
Accept Reality And Take What You Can Get
You always have the choice of accepting that this is how things are now and be okay with it. That’s what most of your friends will do. You can choose to send out hundreds of resumes and cover letters, cross your fingers and hope and pray you get an interview. Go to networking events. Offer to work for free to get your foot in the door. Polish up your LinkedIn profile. You’ll probably need to move back in with mom and dad (if you haven’t already). And you’ll probably eventually land a job that will enable you to start paying back your student loans. Maybe you’ll even be able to move out of your parents’ house.
Launch A Non-Traditional Job Search
I’ve written about working overseas a lot because I believe there are many advantages to sending yourself abroad. I think it forces you to be self-reliant. You learn to improvise and adapt to your surroundings. And you quickly develop skills and open yourself up to opportunities that probably wouldn’t be available to you at home. You can easily stop searching Monster and CareerBuilder for jobs and start searching Dave’s ESL Café right now if you’re interested in taking this non-traditional path to your first real job.
While teaching English overseas is the most direct route to an overseas job, there are other possibilities for launching an international career. And you can also get creative and set yourself apart in your job search here at home. For example, instead of blasting out resumes and cover letters for jobs posted on job boards you could put together a video presentation that showcases your talents and post it to YouTube. Keep the video private, and send the link out to hiring managers at companies you want to work for. You can usually track down those managers through LinkedIn by using some of the stalking techniques we’ve covered before.
Start Your Own Business
If nobody else will give you a job, why not give yourself one? If you already have a place to live and a primary source of income – even if it’s waitressing – you could start a business. Your business could be anything from blogging to graphic design, giving manicures and pedicures to importing products from China and selling them on eBay or Amazon. You could also head overseas to start a brick-and-mortar business in a lower-cost destination.
Whichever option you choose, you’re going to need to take action – consistent action every day – to get what you want. Don’t let the rosy job statistics put out by the government lull you into a false sense that the job market is turning around and good jobs will get easier to find. They won’t. You have to go out and dig for them.