Economy
9:56 am
Fri June 7, 2013

Are There Jobs Out There For Recent Grads?

Originally published on Fri June 7, 2013 2:53 pm

Transcript

CELESTE HEADLEE, HOST:

This is TELL ME MORE from NPR News. I'm Celeste Headlee. Michel Martin is away. Coming up, we speak with a Pulitzer Prize-winning photographer who just lost his job after 44 years at the Chicago Sun-Times. But first, speaking of jobs, the latest figures are out from the Department of Labor. The U.S. economy added 175,000 jobs last month. That's the good news. The bad news is the unemployment rate rose to 7.6 percent. How does that math work? We're going to talk about that.

Also, it's June. That means it's graduation season and we'll find out what kind of jobs new graduates can find or can't find. I'm joined, once again, by Marilyn Geewax. She's the senior business editor here at NPR. And also with us, the Wall Street Journal's Sudeep Reddy. That you both for being here.

MARILYN GEEWAX, BYLINE: Hi.

SADEEP REDDY: Hi.

GEEWAX: Good to be with you.

HEADLEE: First, Sudeep, let's do this math here. How do we add nearly 200,000 jobs and see the unemployment figures rise?

REDDY: It's a curious issue but this is actually a case where bad news is actually good news. The unemployment rate rose in the latest month because a lot more people came into the labor force. Over the course of the recovery, which is now about four years old, since we came out of the recession, we've seen a lot of people dropping out of the labor force. They've been giving up hope. Those people don't count as unemployed once they leave the labor force.

Now they're starting to see signs of economic recovery, they're coming back in. If that continues, you may actually see the unemployment rate go up a little bit more before it comes down. But overall, that's a good thing, if you're adding jobs at the same time and if you see those payroll numbers increasing month over month.

HEADLEE: Okay, so on the balance, is this jobs report, in your opinion, Sudeep, good or bad?

REDDY: It is relatively good. We're still in a very slow recovery. It's about the pace of the recovery we've seen for the last two or three years. So that's still troubling that we haven't really taken off the way a lot of people hoped we would. It's been a choppy recovery, lots of ups and downs, lots of volatility.

But when you look across an entire year, we've been remarkably steady and that's what's kind of hard to realize, is to see a steady recovery, despite all of the anxiety we've had over the last couple of years, is kind of remarkable. And we'll look back at that and see that we continue to gain month over month.

HEADLEE: So far, the Dow certainly likes the jobs report. Marilyn, what do you think? Do you agree with Sudeep that this is, on balance, a good report?

GEEWAX: You know, when we think back how the year looked back in January, looking ahead, we know we had higher taxes. There was a deal cut in Congress in December and that raised taxes on the wealthy.

It also took away that payroll tax holiday that we were enjoying, so everybody saw a chunk of their paycheck disappear. And then, of course, there was the whole congressional battle over spending, where scores of billions of dollars had been cut from the budget and a lot of people thought that process that we called sequestration would really squash the economy. So you know, we came into this year with a whole lot of weights on our shoulders and yet, we still seem to be chugging along. So I guess you'd have to count that as not great but pretty good.

HEADLEE: Well, is it different depending on your age? I mean, we've heard for a long time that this recession has been particularly hard on young people, recent grads. Obviously, it's graduation season. You mentioned in a piece that you wrote for NPR.org that the unemployment rate for people under 25 is much higher than the general population.

GEEWAX: Yes.

HEADLEE: So how is that outlook now?

GEEWAX: All of these things are sort of relative, but this year, we're seeing better job prospects than we have in the last three or four years. It's been a long, bad recession. It's been a slow recovery. So the survey showed that jobs are better and especially for college graduates, the offers for pay for beginning workers are up about five percent, overall. So that's pretty good. But still, we have a tremendous problem with youth unemployment. A lot of young people just can't get started in this economy.

You know, it's sort of on either end of the age spectrum. If you're an older worker, it can be pretty tough to find a job, but if you're in that younger category, it's also tough unless you have the right skills. And I think that's really what we're seeing in this job market, is that if you've picked the right careers, things that are like engineering, computers, health sciences, you're doing pretty well, but if you're just a generic young person, sort of kicking around looking for some kind of work to get started, it's a lot tougher.

HEADLEE: And we know, Sudeep, that this is - it's also uneven for those who are African-American or Latino, who have been hit disproportionally hard. What sectors are hiring? Are there jobs like Marilyn is talking about that are good for people who are having trouble finding work.

REDDY: There are some jobs that are good for people. If you're a college graduate, things are actually not that bad. College graduates, the unemployment rate is about 3.8 percent right now. If you don't have even a high school diploma, it's over 11 percent. So there's a huge disparity based on education and that's making a big difference. People who don't have the highest education are obviously having the toughest time.

And those folks who are finding jobs are finding them in parts of the service sector that might not be paying as well, hospitality, restaurants, retail trade, temp workers. A lot of people, obviously, are very happy to have a job these days if they can get one. But these are not paths that are really going to take people up into the middle class very quickly and that's one of our troubles throughout the recovery.

GEEWAX: And I wanted to say something about that figure for college graduates. You may know a young person who's graduated from college and they're not very happy with their job and you hear 3.8 percent unemployment. Gosh, shouldn't they just be grabbing up jobs? But a lot of what's happened with that is they're sort of underemployed. They have a college graduate degree...

HEADLEE: ...and working 10 hours week, yeah.

GEEWAX: ..but they're working, you know, part-time or maybe they're working in retail. They'd like to be a buyer flying off around the world and doing something exciting but actually...

HEADLEE: Well, gee, who doesn't want to do that?

GEEWAX: Right. But the reality is, they're standing there, you know, stocking shelves in a retail job. And that makes that low educational person in a tougher spot. That's why...

HEADLEE: Oh, right.

GEEWAX: ...it's so hard for a person who is a high school dropout. Actually, you might be very good of, a very good worker who would do a perfectly fine job in a retail store, but you can't...

HEADLEE: But you can't compete against somebody with a college degree.

GEEWAX: ...get that job because you're competing with someone with a college degree.

REDDY: And this shows us why these numbers are only numbers and how we have to really look over several years to see how the kinds of jobs people are getting to make sure they're getting the right ones.

HEADLEE: You economists, always trying to make us - or economic reporters - making us take the long view. That's Sudeep Reddy, covers economics for the Wall Street Journal, and Marilyn Geewax is senior business editor with NPR. They both joined me here, in our D.C. studios. Thank you so much.

GEEWAX: Oh, you're welcome.

REDDY: Thank you, Celeste. Transcript provided by NPR, Copyright NPR.