The Waiting Game

The Waiting Game

Millennials take on growing debt as they struggle to find a place in a contracted job market.


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Holly Kelly's story has a familiar ring.



The 2010 LSU graduate and communication studies major looked for a job for more than a year before finally settling into full-time work. She combed Monster.com, The Advocate and other sites for regional jobs in marketing and communications, sending out résumés by the gross and interviewing for about 50 positions. Each brought disappointment. The jobs she wanted didn't want her, and the offers that came through were for commission-only or door-to-door sales positions. Frustrated and in need of health insurance, Kelly ended up transitioning into a full-time position at the corporate travel firm where she had worked part-time throughout college.



“Every job I applied for said that experience was required, but how do you get experience without getting a job first?'” says Kelly, 24, who has revised her career goals and now plans to pursue a travel agent's license. “It's really kind of aggravating.”



With more college graduates than ever pouring into a job market that went south after 2008, much ado has been made about the convergence of challenges now faced by twenty-somethings. The job market has stiff-armed recent graduates, just as rising tuition and a languid economy have forced many to borrow more money to complete school. Last year, U.S. student loan debt reached $1 trillion and has now surpassed the nation's collective credit card debt. The average debt per graduating student across the country is $25,000.



DEBT LOAD

Louisiana college graduates may have a slight edge over their counterparts elsewhere when it comes to debt, thanks to generous assistance programs. More...

The situation has diminished the expectations of millennials, who were raised to believe that a four-year degree would lead directly to stable work and rapid advancement. Instead, the last few classes of graduates have had experiences like Kelly's: a job comes along eventually, but it's not always aligned with their degree. A study released last year by the John J. Heldrich Center for Workforce Development at Rutgers University found that 81% of recent graduates surveyed took more than six months to find full-time work. Of those employed, 40% reported their first jobs did not require a college degree.




The job market for recent graduates has been muddled by a number of factors, including a lack of movement within the existing workforce, says Louisiana Workforce Commission Executive Director Curt Eysink. Current workers approaching retirement are hanging on to positions in the hope that financial markets will stabilize, and some part-time workers have ramped up to full-time to augment family budgets.



“Fewer people were leaving the workforce from 2009 to 2010, because of pressure to continue to work,” Eysink says. “They delayed retirement, and that has reduced opportunities [for graduates].”



There's also more competition for entry-level positions. This spring, more than 32 applicants are expected to apply for each available job opening, up from an average of 21.1 applicants last year, according to the National Association of Colleges and Employers.



The situation remains challenging for graduates, but there are signs that it might be improving. NACE reports that employers will hire 10.2% more college graduates across the country in 2012 than they did in 2011, and more companies are participating in career fairs. Employers at LSU's spring recruitment fair jumped from 131 in 2011 to 177 in 2012, restoring participation to levels reached before 2009, when a noticeable drop-off occurred.



“While 50 more might not seem like a lot, those additional employers yielded an increase of 314 more interviews,” says LSU Career Services Associate Director of Employment Services Trey Truitt.




In Louisiana, the plight of the recent graduate is unfolding in a manner both challenging and hopeful. State unemployment is at 7%, and the Louisiana Workforce Commission predicts future job growth will surpass the national average in the next few years. Moreover, the debt load of Louisiana graduates is mitigated by two advantages: below-average tuition costs and the state-funded TOPS program, which subsidizes tuition for residents with a 2.5 GPA and an ACT score of 20.



The problem, however, is that there still aren't enough jobs for the flood of young men and women graduating from the state's four-year institutions, say observers. Steps are under way to correct it, but the current job market isn't well-aligned with many curriculum programs. Most students will eventually find full-time work, but it may take longer than they—or their parents—anticipated, forcing some to settle for positions they didn't want, leave the state or accept more debt and enroll in graduate or professional programs.



WHERE ARE THEY NOW?

A look at those who graduated from college, nationwide from 2006 to 2010

53% Employed full-time

7% Working part-time, seeking full-time work

5% Working part time, not seeking full-time work

3% Self-employed

14% Attending graduate or professional school while employed

7% Attending graduate school while unemployed

7% Unemployed and seeking work

2% Unemployed but not seeking work

2% Military

SOURCE: "Unfulfilled Expectations: Recent College Graduates Struggle in a Troubled Economy," Rutgers University

“Our students are competing reasonably well, but it's taking longer and it's taking more of them out-of-state to jobs in places like Houston and Dallas,” LSU Chancellor Mike Martin says. “Students have to be more patient and more strategic and more adaptable if they want to find a job.”



Martin continues, “Frankly, we have oversold the notion that a bachelor's degree is the way to an immediate career. In many cases, it is not.”



The 2011 Employment Outcomes Report released by the Louisiana Board of Regents reveals that 18 months after graduation, just 59.5% of 2008-09 bachelor's degree recipients were found employed in Louisiana, compared to 72.5% of those who earned associate degrees.



Eysink says Louisiana's overselling of the four-year degree stems back to the 1970s, when there was a strong push in the state for high school graduates to enter college. A lack of admissions standards at most institutions made it easy. This trend, combined with the state's underdeveloped network of community and technical colleges, left a vacuum in the labor market for positions that support professional careers like engineering and medicine. That is being rectified somewhat by the creation of the Louisiana Community and Technical College System. Enrollment at community and technical colleges has more than tripled since the system was formed in 1999 and is now about 80,000.



Even with higher percentages of job placement than those holding four-year degrees, associate degree completers are still finding the job market slow to penetrate in some cases. High-demand fields like nursing and process technology haven't absorbed new graduates as quickly as predicted, says Louisiana Community and Technical College System Vice Chancellor Monty Sullivan.



“It's not that our numbers were wrong,” Sullivan says. “We see this as a temporary market correction. You might see fewer seats filled in classrooms in the short term, but there will not be reduction in these high-demand programs.”



While the number of high school graduates opting for community college and technical education increases annually, many more students still choose four-year institutions. The pressure comes from employers, parents and highest levels of government. President Barack Obama declared in 2009 that by 2020, 60% of adults between the ages of 25 and 34 should have a college degree if the United States is to increase its global competiveness.



MAKING MONEY

A look at trends in first-job salaries nationwide

$30,000 Median salary pre-recession [2006-2007]

$27,000 Median salary recession [2009-2010]

$34,680 Median salary for those who completed an internship

$28,000 Median salary for those who didn't complete an internship

$33,150 Median salary for male graduates

$28,000 Median salary for female graduates

$35,000 Median salary for those working in a job related to their degree

$25,000 Median salary for those working in a job not related to their degree

SOURCE: "Unfulfilled Expectations: Recent College Graduates Struggle in a Troubled Economy," Rutgers University

What's your major?

The college experience might be about opening the mind, but tuition hikes and a soft job market have forced families and lawmakers to question the return-on-investment of various degrees. Regardless of their quality or the talents of faculty, some yield work faster than others. The Regents' Employment Outcomes Report found that fields with top employment rates in Louisiana for 2008-09 degree completers were health care, education and engineering technologies, with engineering producing the highest average salary at $57,000.



“Over the last three years, we've seen a 27% increase in enrollment,” says LSU College of Engineering Dean Richard Koubek. The college currently ranks 24th in the nation in the number of undergraduates enrolled, according to the American Society of Engineering Education. A five-year strategic plan implemented in 2010 aims to grow programs that are aligned with the state's job growth, Koubek says.



The College of Engineering has 10 programs of study, including legacy fields such as petroleum and chemical engineering, which produce average annual starting salaries of $78,000 and $65,000, respectively. Koubek says these subsectors will continue to strengthen in Louisiana. Moreover, the state will see job growth in information technology as well as civil, environmental and industrial engineering.



“Six months after they're out, 80% of our students are employed and 18% are attending graduate school,” Koubek says. “Sixty-five percent had jobs when they walked across the stage.”



Even in 2010, often cited as the most challenging recent year for graduates, the slowdown resulted in LSU engineering graduates receiving one rather than multiple job offers, Koubek says.



Engineering programs will continue to flourish, in large part because of their tidy alignment with state job expansion. Even with its severe budget cuts, Southern University will also foster its engineering programs, reported Chancellor Jim Llorens to the Baton Rouge Press Club on April 16. The 100-year old institution declared financial exigency in 2011 and continues to cut faculty and degree programs, but engineering, along with nursing and teaching, presents the school's strongest value proposition, Llorens said.



HIS OWN BOSS

Recent LSU graduate Sean Simone describes the atmosphere among job-hunting college seniors as competitive and stressful.

"It's definitely not all cheery and positive. It's an every-man-for-himself mentality," says Simone.”I don't think people our age realized it was this bad, but now they're hit with it." More...

More school = More debt

Graduate and professional school has been a strong draw for many of Louisiana's graduating college seniors, who are leaving college with a lower-than-average debt load vis-à-vis their national peers. These students also believe grad school is a necessary step in distinguishing themselves from the competition.



“I do think it is more difficult to find a job today,” says Angela Longs, a senior English major at Southeastern Louisiana University. “There are not a lot of entry-level jobs. It depends on your major and where you look, but it seems like a bachelor's degree is the equivalent of a high school diploma.”



Longs has volunteered in Woman's Hospital's marketing department and is currently interning at a Baton Rouge marketing startup as she looks for a job in health care communications. Still, she decided a few months ago that graduate school would prepare her for higher-level work, so she made last-minute plans to attend the LSU School of Mass Communication in 2013.



FIELD OF EXPERTISE

44% of graduates nationwide who are employed found a first job very closely related to their field of study.

30% of graduates nationwide who are employed found a first job either not closely related or not at all related to their field of study.

26% of graduates nationwide who are employed found a first job somewhat closely related to their field of study.

SOURCE: “Unfulfilled Expectations: Recent College Graduates Struggle in a Troubled Economy,” Rutgers University

“You really have to have that additional degree,” she says.



But even master's degree completers find the job market slow to produce. Just 62.1% of 2008-09 graduates were employed in Louisiana six months after graduation, according to the Employment Outcomes Report. The outlook is better for law school graduates, but the process is still slow and frustrating.



Former LSU English major Lisa Martinez used her undergraduate degree and work experience as a paralegal to advance to the LSU Paul M. Hebert Law Center and is now a third-year law student approaching graduation. LSU Law has a reputation of being one of the nation's most affordable law schools, but Martinez will still graduate with a debt load of $65,000. The Denham Springs native says she feels the pressure to find a job as quickly as possible and has been surprised by how tough the market is.



“Graduates are having to compete with young lawyers who might have been in the profession for a few years and are looking to make a move,” she says. “For the top of the class it might not be as difficult, but overall it's very competitive.”



Martinez says she falls south of the upper ranks and lacks the family connections that many law students enjoy. She's tried to close the gap by networking, entering national law competitions and taking on as much outside work as her schedule will allow.



“I've held six different positions, four of them paid and two volunteer, to gain as much experience in the field as possible,” says Martinez. “But it's hard. I've interviewed for a lot of jobs, but nothing yet.”



A LEARNING EXPERIENCE

What students nationwide say they would have done differently to succeed in today's labor market

48% Would have been more cautious about choosing their major or would have chosen a different major

47% Would have done more internships or worked part-time

38% Would have started looking for work sooner while still in college

27% Would have taken more classes to prepare for a career

14% Would have gone to a different college

4% Would not have gone to college

SOURCE: “Unfulfilled Expectations: Recent College Graduates Struggle in a Troubled Economy,” Rutgers University

In April, Martinez was a finalist for a clerkship with a judge in Monroe. She says she didn't want to move to the north Louisiana town, but would do so if offered the position.



Second-year law student Mark Assad says he was also surprised at how challenging the job market has been for graduates and for students looking for summer clerkships.



“I knew it would be difficult, but I didn't know how difficult,” he says. “The running joke is when you accomplish something in law school, you immediately update your résumé. You're always asking, ‘How many extra things can I do?'”



LSU Law Center Chancellor Jack Weiss says that students are living in a time when job hunting needs to begin at the outset of their school career.



“I make it a point in my opening remarks to every first-year class to talk about employment, and what I say is that students should be thinking about employment from that first day forward,” he says. “We've tried to communicate a greater sense of urgency and responsibility with respect to finding a job.”



Law school enrollment around the country is down about 17%, and the number of Law School Admission Test (LSAT) takers has fallen 25% in the last two years. The unemployed law school graduate has become representative of the recession's fallout, and some frustrated former students have even sued their schools for inflating job placement numbers.



Weiss says that the law center and its graduates are faring well against this negative national backdrop. Enrollment is down only 2%, and the school has maintained a solid job placement rate throughout the recession. It may take graduates longer to find work, and their first jobs might not be what they'd envisioned, but within nine months of graduating most are employed in full-time law or related positions, says Weiss.



Ninety-three percent of the 2011 graduating class found employment within nine months, up from 92% in 2010 and 89% in 2009. Most of these new lawyers will stay in Louisiana and will be employed in firms with 50 or fewer lawyers, Weiss says. In 2011, 27% of the class found work in Baton Rouge.



THE PRICE OF COLLEGE

What it costs resident undergraduates to attend the Spring 2012 semester full-time at LSU while living on campus:

$6,366 Room & board

$2,273 Tuition for 15 hours of classes

$955 Personal & miscellaneous expenses

$750 Books & supplies

$545 On-campus transportation

$501 Required fees

$245 Academic excellence fee

$80 Operational fee

$75 Technology fee

$11,830 Total for one semester

SOURCE: LSU Financial Aid

Spots at large, established firms like Kean Miller are among the most competitive. The firm has made four or five new hires in each of the last three to five years, says recruiting partner Richard McConnell.



“We've hired primarily from our recruiting pool,” says McConnell, referring to law students who land envied clerkships over the summer. “Class rank gets you the interview—that's standard—but we look at educational background and professional experience as well.”



McConnell says many firms have shied from new hires and favor taking on lawyers with a few professional years under their belt. The trend has increased pressure on students to stand out.



“Law students are aware that the job market is still tight. They're anxious, and they're getting creative in the way they present and articulate the case to hire them,” he says, adding that a crisp blog or social media presence doesn't hurt.



A big blue ocean

Eysink says Louisiana must continue to grow jobs that are attractive to a wide swath of college graduates. He says that's happening, as demonstrated in the uptick in fields such as digital media and information technology and other so-called Blue Ocean strategies that have helped land several new companies, including EA Sports in Baton Rouge and GE Capital and Gameloft in New Orleans.



“The picture is definitely improving at all levels of employment. In the past, when you compared the growth of our economy to other states, we were underperforming,” he says. “But what we're seeing is that our rate has caught up to the national rate and is likely to surpass it. The outlook is as bright as it's been.”



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