While some of the graduating class of 2020 have already felt the early effects of COVID-19 of the economy, the full extent of the pandemic will not be seen until we look at the jobs markets of 2021 and beyond.
The more fortunate group of 2020 had their contracts signed and jobs tied up before the pandemic struck which was too late to see a major upheaval in behaviours.Those who did put off entering the graduate jobs market until 2021 will face a competitive year.
It is widely expected that there will be fewer jobs available, with no let-up in the supply of graduates. But what does this mean for students? Is this just a matter of riding the wave and being a better applicant than their colleagues? Unfortunately, things look a little more complicated.
While the cream will always rise to the top, there could be some unfair victims of this situation. The more competitive market could lead to higher rates of graduate unemployment and lower wages for those who do end up getting jobs. While this is problematic on its own, the effects could go further than this.
Traditionally, those who graduate into recessions, never reach the earnings potential of those who graduate into better times, a concept known in economics as scarring. These graduates tend to have an inferior sense of worth in the workplace and reduced bargaining power in future wage negotiations. Having said this, the recession of 2020 is like no other before in its mechanics and it would be naïve to assume that it will have the same effects as its predecessors.
So, what are the other options for graduates? Masters are growing massively in popularity. Applications to such programmes tend to increase in times of economic turmoil and this time will be no different. The supplementary degree allows graduates to upskill while waiting out the turbulent jobs market.
The major drawback of this route is its financial weight. Masters can be expensive, and the high cost of living near colleges shows no signs of abating. Those who can afford it, or with parents willing to foot the bill, will inevitably be more likely to take up places on these programmes. COVID-19 has hit jobs traditionally worked by college students the hardest, making the funding of masters ever more difficult.
These prospects can change rapidly. Vaccines and treatments may come soon enough to save the jobs market and graduates may be on the pigs back before they know it. Governments are more involved in jobs markets than ever since the turn of the millennium, so who knows what is truly in store.
Conor Bergin – Business Correspondent