How to save the class of 2020

How to save the class of 2020
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Thanks to a virtual commencement season, members of the Class of 2020 wondering “Now what?” could use some of their new found free time to benefit from the advice of all sorts of successful people. 

They can stream encouragement for days: to get back up again when life does not shape itself to their plans, to accept backtracking as part of climbing to new summits and to do what is right even when leaders set a poor example. 

Yes, graduates will have to be adaptable, resilient and look out for their communities as they look out for themselves. 

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As a leader in the field of university career development, I’ve also shared this message with tips that advise graduates to focus on maintaining calm, persistence and a focus on doing the next right thing while searching for a job. 

But the truth is, individual resiliency goes only so far to counter the scale of a systemic economic shock.

According to the April unemployment statistics released last month, 2020 graduates are entering a labor market where nearly 26 percent of all workers ages 20-24 reported unemployment and workers aged 25-34 were unemployed at almost 15 percent, which is 3 percent higher than those past their mid-30s. 

If our care and wisdom stops with this well-intentioned advice, we might wear un-ironic "Ok Boomer" t-shirts to all our virtual speaking engagements for the next decade.

It’s time to follow our words of advice with systemic solutions that can help. In particular, leaders of cities and states receiving stimulus aid have a unique opportunity to use the current stimulus efforts creatively to set these graduates and businesses in their communities up for successful recovery from the COVID-19 crisis together.

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Cities and counties eligible for COVID-19 relief reimbursement through the CARES Act can counter the cycle this time by creating a subsidy for a transitional program that incentivizes local employers to employ class of 2020 graduates at competitive wages through the end of the year.  

In fact, most large municipalities in the U.S. invest in ongoing employment subsidy programs that incentivize employers of all types to train and hire disadvantaged workers in their communities. These programs mimic competitive employment in terms of the types of work and offer market based wages. They are justified according to a straightforward economic rationale: improve health and families with competitive wages and you offset demand for other public subsistence benefits. 

States could offer a tax credit to employers who participate for the next tax year, offset by the local spending and tax payments that competitively paid workers with 2020 degrees will contribute back in the long run. 

Universities could also be valuable partners to governments and employers in this effort. Together we might even learn something that will help strengthen efforts to connect education, talent and meaningful work more efficiently in the future.

To be sure, those with degrees are not the most vulnerable workers in a recession. Unemployment for those with some or no college does occur at higher rates in a recession. Those workers will continue to need support. A Class of 2020 CARES employment program need not subtract from valuable efforts to support other disadvantaged workers.

Recent graduates are vulnerable in ways you might not immediately imagine. A slow on-ramp to careers for those whose graduations coincide with the beginning of a recession depresses their wages into mid-life. 

The problem is that psychological and behavioral effects of missing out on an initial opportunity during a constrained labor market persist for a decade or more after the economy recovers for others, including those who graduate just one or two years later.

Northwestern economist Hannes Schwandt described the impact in summary of a 2019 study: “The bad luck of leaving school during hard times can lead to higher rates of early death and permanent differences in life circumstances” including lower rates of marriage, higher rates of divorce and increases in disease and mortality. The study estimated a shocking 6 percent increase in age-specific death rates by age 50 for graduates who enter the labor market during even a moderate 3 percent increase in unemployment.

Given all that we now know about the long term impacts of the unfortunate timing, we have an opportunity to shift the story this time. In 30 years’ time, these graduates will be sharing their own words of inspiration and wisdom with the next generation. Let’s give them a story to tell about how their communities took the long view and gave them a hand up when they needed it most. 

Abra McAndrew serves as assistant vice president of Access, Engagement and Opportunity with the University of Arizona. She is a Public Voices Fellow with The OpEd Project.