Writing on the NYT, the economist Tyler Cowen says once the economic infrastructures fail, it takes much longer for a full recovery to happen. He also discusses in details that the results of the recent recession will last for decades, entailing many changes in our labor forces (Seniors, embrace this news!):
"Here is another change that might be a broader sign of a pending reset: A heavy burden of adjustment in the overall labor market is being borne by the young. Wages for the typical graduate of a four-year college have dropped more than 7 percent since 2000, and the labor force participation rate of the young has been falling. One consequence is that young peopleare living at home longer and receiving more aid from their parents. They also seem to be less interested in buying their own homes.
All of these factors could indicate that our economy is evolving into one that will offer far less favorable long-run wage prospects. Much research has shown that the effects of a recession can be pernicious for decades: Earning a lower wage in earlier years is predictive of lower wages through the rest of one’s career. While we are seeing economic problems for the relatively young, they will eventually become dominant earners in the economy and the major force behind broader statistics."
I think it's interesting how the the economist Richard Florida regarding this period of slow economic rebound the "The Great Reset." The idea that we're scaling back economic expectations as a result of slow growth, however, certainly doesn't bode well for us. Also, the author talks about how one view of the current situation is that we've allowed the current recession to last for too long, allowing some of the recession-istic features to become entrenched. I think this is a very interesting, but also very realistic view of the current situation.
ReplyDeleteWhile it does seem that the recovery is taking longer than planned, I do think progress is being made incrementally. Hopefully that progress becomes more apparent over the next few years and attitudes begin to shift. I recently read that jobs are starting to be unable to be filled due to a lack of qualified people, so that is a positive for us in terms of our education and entrance into the markets.
ReplyDeleteI also have to agree with Aleksis that this article is very interesting because it looks at this current recession period in a realistic perspective. I feel as though the economy has begun to see improvement, but that it is not at the pace that our society would like it to be at. As for jobs I find it intersting that this article speaks of lower wages for the young college graduates, yet as Nolan stated jobs are begin unable to be filled due to qualified people.
ReplyDeleteI wasn't aware that wages for college graduates have declined by 7 percent since the start of the 21st century. This news was clearly alarming to me as I am planning on entering the workforce soon. I thought this topic fit in well with what we blogged about earlier, that it has become harder and harder for employees to find growth opportunities in terms of wage ever since the recession. I also feel like, due to the recession, having a four year degree from a college does not carry as much weight as it used to.
ReplyDeleteI think this an interesting article. I agree that the job market has been tough in the past few years. It appears that recent graduates are having a tremendously hard time finding entry level job positions that reflect their level of higher education. The reason being, employers are looking for people with not only an higher educational background but expect undergraduate to have several years of experience. Therefore, I think the reason employers are unable to fill positions has to partly do with there expectations and not hiring undergraduate students in order to give them the experience they need to be able to advance to higher level positions. Also, I think another part of the issue has to deal with overqualified graduates filling up jobs that would have gone to people who meet the minimum requirements for that particular position. This as a result creates the issue of decrease in value of higher level education that Tyler previous mentioned. All in all, these are just some of the factors that contribute to the slow economic recovery.
ReplyDeleteI agree with all of Farhiya's points and Nolan's point that economic recovery is a relatively long gradual process. I find it ridiculous that earlier wages should indicate the future wages of a worker especially when it already difficult to find a first job; that is, younger workers are willing to take a lower wage in order to ensure they have a job. In today's economy, when these younger workers become the dominant earners the median wage of the United States may decrease as a result of workers accepting lower wage jobs earlier in their career
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