Earnings Escalator has stopped for Grads by Susan Reimer

Baltimoresun.com/reimer

3/30/08

Jessie, my college aged daughter, once declared herself to be "unemployable." "I can't possibly work five days a week. I can't possibly get up this early every day. And I can't possibly do all this commuting." she said in a huff.

She was about to start an internship that required her to get up early and commute 5 days a week, and she was miserable. "Yep." I said. "That would make you unemployable."

Reality fast approaches. She will graduate from Penn State in May and although many Penn State students are so happy in Happy Valley that they dread leaving the blue and white womb I think she's ready.

She isn't ready to get up early and commute five days a week, but I think she finally might be curious about what employment will look like for her. I think she'd like to earn some money, instead of relying on her ability to charm her father.

Me? I'm worried as hell.

When I graduated from college, my starting salary was equal to what my father was earning at Alcoa after a 40 year career.

The "escalator effect," which promises that each generation will do better than the last, was working for me.

It won't work for Jessie. I don't make that much but she has no hope of earning anywhere near what I earn when she starts out.

Jessie plans to live at home with us. I'm delighted. When we get to slamming pots around the kitchen, my husband just beams and waits for us to put a plate in front of him.

Living at home puts geographic limits on her employment opportunities, but the fact is that wages, especially entry level wages have stagnated while housing, gas and food proces have soared.

Jessie might have to have 14 roommates if she wanted to move out.

And she's one of the lucky ones. Her parents paid for her college. The average student loan debt for graduating seniors nationwide is 21k according to the Project on Student Debt. Her parents gave her one of their old cars, so she doesn't have that nut to crack either.

We have been picking up the check for her for 4 years, so she doesn't have the average of 3k in credit card debt on top of it all.

And we made sure she will be covered by health insurance, even if she doesn't find work right away, so she doesn't have to worry about that.

Heck, she's even on my car insurance and cell phone plans.

But Jessie will enter a working world much harsher than the one her parents entered out of college.

Her job will be tied tightly to her performance and to her company's performance. Her employer will keep her only as long as it benefits him to do so.

Any raises she gets will be based on performance. There will be no annual increases based on seniority. And she can have no expectation of having the same job for all her working life.

She can expect to see her paycheck dimished by increased soc. security deductions, and she will have to fund her own retirement with payments to a 401k plan of some kind, and she will be paying a significant share of any health insurance coverage.

She will probably have to go back to school for some kind of advanced degree-a bachelor's degree is the new high school diploma and that costs money.

HER LIFE OUTSIDE OF WORK WILL BE PRETTY SPARE.

Without much of a paycheck, she isn't going to be able to travel or buy lots of clothes or furnish her place with the luxuries she-thanks to her parents indulgence-thinks of as essentials. If she isn't careful, she will get herself into massive credit card debt trying to recreate the life she had at home.

I look at Jessie and her beautiful, laughing collection of girlfriends and I think that I understand why so many of them want to stay in college-the halfway house between childhood and adult responsibilities.

Compared to the real world, it is so appealing.

elana's thoughts

powerful article, ehh?