Quote:
Originally Posted by JLarson
(Post 3860605)
Again you aren't wrong, but the average debt post-college has increased from 10k in the 1990s to 30k as of 2016, and that's the average. Wages also haven't increased, except for a select slice of the population.
Take me, for example. I worked in my family business doing construction with my dad and 2 of my brothers. Someone once commented they knew we weren't union because we ran to get tools ;) Anyway, housing market crashes. I'm waiting for it to get better, not aware of the true implications; my savings are eaten up (and I didn't have a ton before that) so moving wasn't an option without a guaranteed job, because I barely had money for rent (we rented a house, 4 of us, $1150/month, split it 4 ways. No cable, utilities not included). I bought knorr packaged noodle knock-offs for dinner because they had the most calories I could find for the cost, peanut butter sandwiches on whole wheat for lunch, drove a 25 year old car.
My point is you can do all the right things, have a great work ethic, a real sense of independence (I didn't once suckle from the government teat), and still get screwed ridiculously.
Today I am incredibly blessed with a great job, work for a great company, and my frugality paid off, but out of all of my friends I'm the only one who really broke through - and some of these people are bright, capable, and extremely under employed given their skill set. That's the real threat today - underemployment, not unemployment.
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You make an excellent point. I cribbed this from the WSJ, May 9, 2009, at the height of the recession:
"Economic research shows that the consequences of graduating in a downturn are long-lasting. They include lower earnings, a slower climb up the occupational ladder and a widening gap between the least- and most-successful grads.
In short, luck matters. The damage can linger up to 15 years, says Lisa Kahn, a Yale School of Management economist. She used the National Longitudinal Survey of Youth, a government data base, to track wages of white men who graduated before, during and after the deep 1980s recession.
Ms. Kahn found that for each percentage-point increase in the unemployment rate, those with the misfortune to graduate during the recession earned 7% to 8% less in their first year out than comparable workers who graduated in better times. The effect persisted over many years, with recession-era grads earning 4% to 5% less by their 12th year out of college, and 2% less by their 18th year out.
For example, a man who graduated in December 1982 when unemployment was at 10.8% made, on average, 23% less his first year out of college and 6.6% less 18 years out than one who graduated in May 1981 when the unemployment rate was 7.5%.
For a typical worker, that would mean earning $100,000 less over the 18-year period.
The impact on wages could be just as severe this time around, says Ms. Kahn. That's because of the depth of this recession and the possibility that the unemployment rate may approach the 10.8% level not seen since the early 1980s. The rate hit 8.9% in April, the Labor Department reported Friday.
One reason behind declining wage potential, economists say: The caliber of jobs available in a recession, and their accompanying wages, tend to suffer. High-end firms hire fewer people and drive down salaries because jobs are in such demand.
That means many graduates end up with lower-wage, lower-skill jobs at less-prestigious firms or in firms outside their field of interest. Once the economy picks up and they try for better jobs, these workers have to learn skills they should have been developing immediately out of college. In the meantime, colleagues who graduated in a better economy have already developed these skills and progressed much further."
That all being said, a lot of the members of my generational cohort are whiny b*tches.
