The Market Demands That 20-Somethings Demand Raises
As we all probably know, millennials in the job market find themselves staring into a vast vortex of student loan debt, high unemployment, high underemployment, and un- or underpaid positions. Millennials graduating straight from high school or college into this market are mired in a very real struggle to earn a decent living, often having to accept unpaid internships and retail jobs that have nothing to do with their chosen field of study, taking side jobs and "gigs" with greater frequency.
But this unwieldy vortex has warped our experiences in the job market in another, less well-reported way. Are millennials being groomed to expect lower salaries on top of everything else?
A competitive job market means less aggressive salary negotiation for people our age. Basically, we're willing to take anything to put food on the table and pay our student loans. Are companies using the economy as an excuse to keep pay artificially lower for longer than they should?
Business are hiring less and freezing pay, stagnating careers for the millennials who have managed to get their foot in the door. The economy has forced workers with jobs to work harder. Businesses are maintaining profitability in spite of the reduced workforce, and thus are not looking to hire.
Lower pay at the outset of our careers, greater debt, and reduced opportunities to advance in traditional career roles essentially guarantees that millennials will earn less over the course of their lifetimes than generations before. A $5000 difference in income early in your career can cost $600,000 over a lifetime, according to a study by George Mason University (hey alma mater!) and Temple University. A study in 2009 examining some of the first millennials to enter the job market found that 20% of the age 21-30 crowd received a pay cut, and 14% lost their jobs compared to 8% of Boomers. The economy is disproportionally impacting younger workers, making it much harder for them to recover from such losses, both financially and professionally.
I don't know that any of these practices are deliberate, since the market incentives are there to justify them, but this trend certainly compounds the youthful naiveté and experience gap of a new worker in this economy.
My first job, I moved all the way to Michigan to work on a political campaign. The pay was low, but it was my first job, so I never thought to balk or consider a different option — I actually had a post-graduation offer!
That said, I was completely blindsided by the on-the-job expectations, having never been truly prepared for an environment like a campaign office. I showed up in a suit when everyone wore jeans. I showed up at 8 a.m. and left at 5 p.m., eventually getting myself in trouble for not being there at the same time as the rest of the team, who had enough experience to understand campaign work hours.
On top of my over-eagerness, I was very bad at budgeting. I knew my salary, but I thought it would go much farther than it did. The hourly wage jobs I had in high school and college made me think that having a salaried position, any salaried position, was better. I was wrong. My inexperience translated to a much more daunting entrance into the "real world" of work.
My first job in Washington, D.C., as I simultaneously pursued a master's degree, was a barely paid (but paid!) job on the Hill. After struggling with the time constraints of full-time work, a multi-hour commute, and low pay, I had to explore more flexible options. I found another barely-paid part time position with fewer hours that allowed me greater time to devote to both work and school.
Unfortunately, while both positions provided a wealth of experience, neither position gave me the opportunity to negotiate a salary package, and neither paid enough to get me by. I finally got to what I consider my first "real" job after spending over a year earning $1,000 a month in an area where my half of the rent was $700, and I had a commute time of over an hour. To get out of my hole, I took the very first job offer I received. I did not know to negotiate my salary; the mere fact it was more than $1,000 a month was enough to cement my acceptance of the offer.
What I did not know at the time was that I left money on the table. Call it being naïve, call it "not enough research," but I learned the hard way that a salary offer can be negotiated, and even a single ask can improve your starting pay.
We spend so many years in this economy working in jobs that don't match our expertise (why is it that an "entry-level" job now requires two years of experience?) and pay so low that the first opportunity to make our entrance into our field is met by relief tinged by desperation, leaving us fearful to push for more.
Recently, I read a great piece called "Take a Job You Aren't Qualified For" which focused on growing within a position and not being afraid to take chances on your own skills and abilities. Yet such a piece is aimed at those who are going into a job without really knowing everything they need to perform the functions of the position, which appears to be pretty rare in this economy. In some cases, to even get a position, you have to be extremely qualified require very little on-the-job training.
Here I am, nearly 30, and I'm only just now feeling confident of the value of my skill-set. It's not an inflated sense of self-worth (no matter who calls me a special snowflake) that makes me reflect on what millennials are paid.
Salaries are falling in many fields; on top of that, new jobs are paying less. The market is giving employers a competitive pool of candidates where they can identify the best bang for their buck, a trend that's unlikely to slow. Next year is the first year to have salaries projected to grow at over 3% since 2008, the very definition of a competitive job market. Businesses are working within these constraints have every incentive and every right under the law to consider their bottom line when it comes to young workers' starting salaries. I don't blame businesses for what they choose to do, but millennials will absolutely bear the brunt of these economic conditions and the way employers behave in response to it.
Millennials are going to have to survive the new paradigm.
All the steps involved in accepting a job offer and working with human resources and a potential new employer could be chances for millennials to change their career trajectories, but we don't know enough to have those conversations.
Our salaries are so important. Our salaries dictate where we can live, our family budgets, and our ability to get loans for a car or a mortgage. An environment that makes us feel desperate to have a job, that forces us to take unpaid internships to become "qualified" for an entry-level position slows a lot of millennials down.
Call it exploitation or call it good business. Call it market-driven decision-making or call it the very thing Occupy Wall Street rails against. It doesn't matter. We millennials have to think about our own bottom lines.