By Jacqueline Otto
The video makes two points, first that there is an influx of college graduates this spring, and second, that there are not enough jobs for them because the government is not fostering a business environment for job creation.
There is a quantitative case to be made that the 1.7 million college graduates of 2011 are the result of the financial crisis starting in 2007. When the economy started taking a downward turn, with the bursting of the housing bubble and distortions in the financial markets, uncertainty filled the hearts of high school graduates and their families. This uncertainty drove those high school graduates who may have gone to trade schools, found a job, or started a small business of their own, instead to go the “safer route” of a pursuing a four-year degree under the presumption that the economy will be better by then. Oh, how we were mistaken.
As a recent college graduate and job-seeker myself, I can vouch for the disappointment and despair felt by post-collegiates who fear that their degree is just a piece of paper. After all, in this market, college degrees are a dime a dozen while jobs are at a premium.
The video correctly chastises the government (both the Bush and Obama administrations deserve blame), for the spending policies that have sent businesses into survival mode. The debt and deficit throw doubt on future tax rates, wreaking havoc on business accounting and financial forecasting. Big government bailouts playing favorites with big businesses and selective stimulus spending favoring some industries unfairly over others have rendered traditional business growth models meaningless.
In this environment of caution, businesses are keeping capital close the vest and are risk-averse to an extreme. Unfortunately, college graduates without work experience are, by definition, risky! And as risks, even entry-level jobs are not being made available to them.
There is no easy fix to this problem; in making businesses the scapegoat for the economic woes, the government has lost trust with the private sector. Trust is not easily re-established, yet trust is necessary for businesses to begin accepting risk (aka young, untested college graduates) again. So is Washington creating our job crisis? In so far as it has spurned business and stifled risk-taking, yes, government is to blame.
It will take several years for government policies to become amenable to industry again, and that is if they start now. For immediate solutions, college graduates should seek out more confident business environments. States with low-taxes and predictable regulations are doing well; Texas and North Carolina usually top that list. Do your best to make yourself less risky by gaining valuable work experience through internships. And do not frown upon any opportunity – a job is a job. You have to start somewhere, and the government certainly is not going to help.