On Friday morning, I'll be taking part in that annual rite of passage -- the commencement speech. I'll be delivering mine at Sarah Lawrence, one of the great colleges in America.
My speech, of course, will be imbued with all the optimism and hope about the future that the occasion is steeped in. But, after looking at all the data, there is no question that "commencement" has taken on an ironic twist.
For many of the graduates spilling into the job market throughout the nation, there isn't going to be much to commence. Economically at least, this is an especially rough time to be graduating from college.
For starters, just getting to Graduation Day has become historically burdensome. For the first time, total outstanding student loan debt will be higher than total credit card debt -- going over $1 trillion. In 2000, the figure was under $200 billion.
In 2008, two-thirds of those getting their bachelor's degree had to go into debt to do so, compared to only half in 1993. And as of 2011, Mark Kantrowitz, publisher of the websites FinAid.org and Fastweb.com, estimates that the average graduate will enter the job market with a debt load of over $27,000.
This actually isn't all that surprising, given the skyrocketing cost of tuition, which has been going up at an annual rate of 5 percent. According to a briefing paper by the Economic Policy Institute, in 2008-2009, the total cost of attending college on-campus was over $18,000 for those going to a public school, and over $38,000 for those at a private school. When you consider that over the same period the median household income in the U.S. was $49,777, it's not hard to see why even a public college is out of reach for so many American families, at least without going deeply into debt.
And the job market won't be doing the Class of 2011 any favors in helping to repay that debt. According to EPI, the unemployment rate for those aged 16 to 24 in 2010 was 18.4 percent, the highest it's been since the number has been tracked, going back 60 years. From April of last year until March of this year, the unemployment rate for recent college graduates hovered around 9.7 percent. In 2007, it was just over 5 percent. And while the fact that we're still clawing our way out of a recession affects those figures, at roughly the same point in the last two recessions -- 1992 and 2003 -- the unemployment rate for new grads was 6.9 percent and 6.4 percent, respectively.
As is the case with the overall unemployment rate, the jobs crisis isn't affecting all graduates equally. In 2007 the unemployment rate for recent white college grads was just over 5 percent, 6.6 percent for Hispanic grads and around 13 percent for black grads. By last year, those differences had grown alarmingly worse. For white grads, the unemployment rate went up 3.3 percent, for Hispanic grads it was up 7.2 percent, and for black graduates it was up 5.9 percent -- for a total black grad unemployment rate of a devastating 19 percent.
For those graduates who do manage to find jobs, their average salary will be $36,866. In 2009 it was $46,500. And a poll by the consulting firm Twentysomething, Inc. found that 85 percent of new graduates will end up moving back in with mom and dad. Unfortunately, given the obsessive focus on the deficit gripping Washington, an emphasis on job creation is unlikely any time soon.
At some point, we can hope, the recession is going to be over, and then all these recent graduates will get back on track, right? Actually, no. Abigail Wozniak, an economist at Notre Dame, found that the effects of graduating into an economic downturn far outlast the downturn itself -- sometimes as long as a decade. "A bad hand at the beginning of a game where everything is connected has lasting negative effects," says Wozniak.
And according to Carl Van Horn, of the Center for Workforce Development at Rutgers, the effects of graduating into a recession go beyond dollars and cents. "They tend to be less risk-oriented," Van Horn said of recession-era grads. "They're risk-averse. If you can get that job in communications, then you're less likely to look over your shoulder and say maybe there's a better job down the road. You say, well, I better stick with this one."
There is, however, a silver lining to graduating in such tough economic times. Conventional wisdom says that today's graduates are going to be less likely to take chances, less likely to pass up the safe bird in the hand, but, in fact, there is now a higher premium on taking risks and following your dreams, creating your job instead of just looking for one.
The road ahead is definitely rockier than the Class of 2011 imagined it would be. But while this may be the most debt-burdened graduating class in history, it's also the most tech-savvy, the most connected, and the most engaged.
This year's graduates need to embrace this, and build on it, looking for innovative ways to do well for themselves while doing good for others. And, while they're at it, they should use these attributes to help hold our leaders accountable, and keep them from turning away from the mess they've made -- with so many missed opportunities and perverted priorities.