Right now most of you are concerned with beefing up your resume for a cushy summer internship, trying to find a job to fund your spring break trip to Cancun or padding your work-study hours to get a little extra money for Ramen. But for the Department of Labor Bureau of Labor Statistics, now is the time to start looking at more substantial employment. Recently, they released statistics that showed job growth has slowed during the Bush administration, raising issues that will sculpt the employment landscape as we graduate.
According to BLS statistics, the economy produced only 3.7 million jobs between January 2001 and December 2006. That may sound good, but consider that the economy produced 17.6 million jobs in the first six years of the Clinton administration (1993-1998) and 9.5 million in the first six years under Reagan (1981-1986). It’s even more staggering when you take into account that Reagan faced two recessions!
So, why so few jobs under Bush? Although the Democrats insist it has to do with Bush’s economic policies, it has a lot more to do with demographics and national events. This period includes the 2001 recession, the September 11 attacks, bursting of the stock market bubble in 2001 and corporate accounting scandals, all of which hurt job growth. More importantly, though, is the aging of the Baby Boomers.
Baby boomers are those “aging hipsters” who were born between 1945 and 1957, when horny American soldiers started families with their wives on leave and others, either fearing the end of the world as they knew it or flourishing in a high tax bracket, had children to capitalize on the times. It’s a formidable generation, with luminaries like Clinton, Bush, Janis Joplin, Howard Stern, Steve Jobs and Madonna. It’s also estimated that they will control Congress until 2015 and the White House until 2021, although spring chicken Barack Obama (46 years old) could throw off that trend.
Although their cultural contributions are great, the boomers are clogging up the labor force. This mass of employees entered the job market in the early 1980s but have not yet retired, holding on to jobs and creating fewer openings for college graduates. The oldest ones are turning 62 this year, putting them four years away from the full retirement age as designated by the Social Security Administration. This means that as we graduate college, the first wave of boomers will be starting to retire. However, most of them will still be working, leaving well short of the cornucopia of job openings that awaited them out of college.
However, there is one silver lining to this aging, slightly wrinkled cloud. According to Maryann Billington’s The Emerging Workforce, 50 percent of American companies will lose 50 percent of their senior management by 2010, in large part because of retiring baby boomers. That means the potential for quick advancement in new careers, as companies will be scrambling to fill those vacant management posts.
Another factor that analysts are predicting will change the workforce is the potential minimum wage increase. House Speaker Nancy Pelosi and the new Democratic majority on Capitol Hill plan to increase the minimum wage from $5.15 to $7.25 in the next two years, a measure that’s likely to pass, considering public opinion. This would boost the wages of almost 15 million workers — that’s 11 percent of the American workforce. Conventional wisdom tells us that higher wages mean companies will hire fewer workers, but there is, in fact, no evidence of significant job loss. Still, this significant of a change in wages will create some degree of uncertainty and turmoil in the workplace over the next few years, potentially poisoning job searches out of college.
If there’s any lesson to be learned from Bush’s slow job growth, it’s that jobs are becoming harder to obtain. Expect stormy waters in your job search, especially as baby boomers start to retire and high-end jobs start opening up. And I’d start aggressively padding that resume if I were you. It’s going to become a valuable commodity.