The impact of the COVID-19 pandemic can dramatically reduce the education and career goals of the developing workforce. As community members grapple with economic challenges, the best way to bounce back is of the utmost importance. For students who graduated during the pandemic or who postponed college, unique challenges could put recent graduates at an economic disadvantage.
One obvious way to improve future income is to obtain a college degree. However, obtaining a degree during the pandemic was a daunting route to uncertain employment outcomes. For many, the carefully crafted plans quickly dissolved. Many high school graduates have chosen to postpone college. According to a study by the National Student Clearinghouse, enrollment for first-year students at a four-year university has fallen by 13% and by 18.9% for two-year programs. While postponing college offers short-term financial benefits, it could create a long-term disadvantage. Those who delay college are less likely to get a four-year degree and more likely to get a two-year degree. Those with a two-year degree are on average $ 18,772 less per year than those with a four-year degree.
Students who graduated from college during the pandemic are also negatively affected. The Pew Research Center has found that these students are less successful in finding employment and cast wider nets. In addition, 44% of recent graduates are underemployed or in a job that does not require a four-year degree. These results are eerily similar to those of the Great Recession of 2008, during which the economic impact on college graduates lasted for a decade.
One assumption behind the challenge of finding a job is that jobs that require a degree hire at lower rates than jobs that don’t. Additionally, younger people have lost jobs and internship opportunities at higher rates than established careers. The loss of on-the-job training and the decline in the number of better-paying jobs place recent graduates at a significant disadvantage. This is especially true for students of color, who lost their jobs at higher rates than white students, further widening the gap for graduation rates.
As vaccinations increase, those whose educational goals have stalled are moving forward. And we desperately need it. An educated workforce is essential for economic prosperity. Communities with more educated workers see their economies grow faster than those with a less educated workforce and can produce business innovations, social and economic mobility, and progressive societal development overall.
While much of what we know about the timing of the economic recovery comes from the recent experience of the Great Recession, there are key differences. The decline in the value of homes with subprime mortgages was a major contributor to the Great Recession. The collapse of the banks and the subsequent loss of generational wealth resulted in reduced spending. The good news is that purchases made throughout the pandemic, such as home gym equipment, could be the key to recovery. Unlike 2008, expenses did not decrease on the same scale. People are eager to get back to their usual spending habits and travel plans.
While the economic future is still unclear, rising vaccination rates encourage hopes of lowering social distancing restrictions on businesses, schools and travel providers. Vaccination will have indirect positive effects on everyone, including young graduates who pursue dream jobs.
Stephanie S. Souter is an Administrative Analyst in the Humboldt County Economic Development Division.