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For lasting salary damage, get hired in a recession

New grads entering the job market have come to expect that during touch economic times — like the present — they may have to settle for a lower salary to get a job. But that flexibility may result in income damage that could take nearly 20 years to overcome, according to new research.

A Depressing Discovery

By equating salaries for new hires to the unemployment rate, a Yale professor calculates that students who graduate during a downturn earn 6-8% less in their first year for each percentage-point increase in the unemployment rate.

That means a 1982 graduate entering the job market when unemployment stood at 10.8% earned, on average, 23% less than a 1981 grad who entered the job market when the jobless rate was 7.5%, according to the blog Daily Finance.

The research, conducted by Lisa Kahn, assistant professor of economics at the Yale School of Management, suggests that the disadvantage may take years to overcome. For example, new hires during a recession may be more reluctant to look for another job, which could bring a salary bump.

“Over 17 years after college those groups have a $100,000 difference in earnings,” Kahn said.

What about the Class of 2009?

The National Association of Colleges and Employers (NACE) just released a list of the top jobs (with salaries) for the Class of 2009. The big news was the emergence of teaching in the top spot.

The top five positions and starting salaries are: teaching ($35,496), management trainee ($41,353), financial/treasury analysis ($52,043), consulting ($56,472), sales ($41,577).

2009 marked the first time in several years that the public sector landed the top spot. And public sector jobs generally pay less than those in the private sector, as NACE’s executive director Marilyn Mackes said.

No surprise: the NACE press release also noted that the average starting salary for new college graduates fell this year. The average starting salary offer for a 2009 bachelor’s degree recipient is $48,633. That comes in at 1.2% less than the $49,224 average offer extended to members of the Class of 2008.

A Broader Perspective

Does this mean new grads are financially screwed for the next decade compared to their peers who are a year older?  Maybe — if you consider Kahn’s research in a vacuum.  But plenty of other factors play into the mix of anyone’s career and salary trajectories.

The Yale salary-comparison research offers a valuable piece of data, but — like the national unemployment rate — it’s not an absolute for every worker.

Kahn herself offers a great piece of advice in the Daily Finance interview: “Don’t accept the status quo.”

For more helpful resources on this salary issue, see these articles:

• Will the Recession Deflate Your Income Forever?
• 4 Types of Pay Cuts, and What You Can Do About Them
• Do You Dare Ask for a Raise in This Economy?

Testimony: Anti-gay bias persists in government workplaces

Workplace discrimination for LGBT employees is just as common in state and local governments as in the private sector, according to testimony delivered in Congress today.

Brad Sears, executive director of the Williams Institute for Sexual Orientation Law & Public Policy, made the observations as part of hearing on the Employment Non-Discrimination Act of 2009. He cited a study — the most comprehensive to date, according to the Williams Institute — that reviewed discrimination against LGBT people in the public sector.

A few other findings:

* One in five LGBT public sector employees has experienced workplace discrimination on the basis of sexual orientation according to a 2008 study; a 2009 study found that 13% had reported such discrimination in the past year alone.

* A persistent and significant wage gap exists between heterosexual and LGBT employees. For example, government LGBT employees earn wages that are 8-29% lower than their heterosexual counterparts.

“This is exactly the kind of data that was presented to support passage of earlier civil rights legislation,” Sears said in a prepared statement, “and Congress should act now to ban discrimination on the basis of sexual orientation.”

For more on today’s hearing, see this AP news article.

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Video: some trends in the job market now

Here is a clip of my appearance on “Money for Breakfast” on the Fox Business Network. We have some discussion about some job-market trends now that aren’t all that hopeful…

Tom Musbach on Fox Business

I am hoping that this post handles the video link well. This will also be my last appearance on the show, which will stop airing next week.

(Now I need to figure out photo spacing issues on this blog.  Note to self!)

I was happy that we had recently done a poll on Yahoo! HotJobs about working overseas, otherwise I would have been pretty stumped by the question from Alexis! I was definitely thinking, “Phew!”

Overused office buzzwords: the list grows

I recently wrote an article about the most annoying and overused terms in the workplace, and readers have been commenting with new words to add to the list.

The basis for the article was a survey by Accountemps, in which 150 senior executives identified the problem words and phrases (e.g. “leverage,” “circle back”). But here’s 10 more they missed, according to Yahoo! HotJobs readers:

• Stakeholder
• Heads up
• Mission critical
• Bandwidth
• Touch base
• In the loop
• Low-hanging fruit
• Moving forward
• At the end of the day
• On the same page

The disdain for so many of the buzzwords runs deep, and I’m surprised by the large number of offending terms. My favorite comment: “How is it that “touch base” didn’t make the cut? That’s an insipid office phrase that’s been going around for years.” (Great word — “insipid”!)

The sad thing is that I use so many of these phrases, particularly in work settings. (Except “low-hanging fruit,” which has always distracted me. Maybe  because it’s so descriptive?) And now I get self-conscious every time I use one of these, so I’m updating my vocabulary when possible.

But it’s important to remember the perspective that Liz Bywater provided while I was researching the article:

“There’s nothing inherently wrong with having a set of terms, a common lexicon, by which people in a given field or industry can easily communicate. This is essentially what business buzzwords are — a set of terms that are readily understood in the corporate environment. When used properly and in context, these buzzwords serve as a sort of linguistic shorthand. When overused or misused, however, buzzwords can overshadow or even distort the overall communication. Using too many buzzwords can lessen an individual’s credibility as an independent, intelligent, creative thinker. At worst, it can make him look like a wishy-washy wannabe.”

I can’t resist: At the end of the day, it is what it is. But keeping everyone on the same page is always a value-add.

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Objectives on resumes are popular, poll says

Starting a resume with an “objective” statement is more prevalent than I expected. Results of the latest Yahoo! HotJobs poll show that nearly 3 in 5 job seekers use them.

Poll Results

Q What is the first major content section of your resume (after your contact info)? An “objective” statement 59% A “summary” statement 20% My most recent job details 21% 4445 Votes to date

Maybe I’m a little surprised because I don’t use an objective statement on my resume. I remember a few recruiters offering some good reasons why to skip it.

But it’s obviously an unsettled area. Check out these articles for more insights:

• Recruiter Roundtable: Objectives on Resumes
• Who Needs an Objective Statement?
• Great Resume Beginnings: Objective or Summary?

Homeless blogger reminds us what internships are

A hullabaloo arose this week over news that Elle magazine has hired a homeless blogger as an intern, paying her less than minimum wage.

Brianna Karp was hired this week by Elle to blog about being homeless and her future, reportedly making $150 a month for 24 hours of work. The amount is less than California’s minimum wage, which made some people accuse Elle of getting good publicity on the cheap. (Karp lives in Orange County.)

But, in email comments to columnist Tommy Christopher, Karp said she doesn’t feel exploited.

“This is an internship. Most internships, as I’m sure you know, are unpaid,” she said. “The whole point of an internship is that it is unpaid and opens doors for the intern which would not have previously been a possibility, and I accepted the internship offer assuming that it would be unpaid, before any sort of money was even mentioned, because I know how much this could help me down the line.”

Internships certainly do open doors. I expect Karp has a promising future, provided that she maximizes the benefit of this assignment. Some key tips for interns for getting the most benefits out of their gigs:

Ask for a recommendation. Get your boss or other leaders to agree to be a reference for you. Perhaps one would write you a recommendation on your LinkedIn profile.

Keep in touch with coworkers. Send cards periodically or have lunch every few months. These people could be great sources for career advice and job leads.

Keep good notes on all you learned and achieved. Use these to update and tailor your resumes sooner rather than later, when you might have forgotten some of what you accomplished.

For more, watch this clip from “ABC News Now,” featuring my discussion with Tory Johnson about internships.

Labor Day surprise: Job dissatisfaction rises

One of the interesting things about this recession has been the modest rise in job satisfaction in a number of polls: People have been happy just to have a job, for the most part.

But that sentiment may be shifting as the economic tide starts to turn, according to a new survey by Adecco.

Workers’ dissatisfaction with their employers gravitates toward three areas: compensation, retention efforts, and career growth.

• 66% are not satisfied with their current compensation
• 78% are not satisfied with the company’s overall retention efforts
• 76% are not satisfied with career growth opportunities at the company

I would have thought that more than two-thirds of workers would report dismay over their compensation. After all, 2009 was the Year of the Salary Freeze.

I’m a little surprised by the overall job dissatisfaction reported in the Adecco survey. The findings contrast a similar survey by Yahoo! HotJobs at the end of 2008 (see article), in which 38% of workers said they were “very satisfied” with their jobs, a bump from 28% percent in 2007. Also, a study by SHRM in June 2009 found that 40% were “very satisfied” with their jobs.

“What workers are telling us is that even during a recession, just having a job does not equate to job satisfaction,” said Bernadette Kenny, chief career officer, Adecco Group North America.

True enough; hiring is still happening. But even though some economists say we’re closer to an economic recovery, it seems too early to tell — at least from the job-market perspective. It’s still VERY competitive out there for job seekers.

If you’re not yet ready to jump from a job you’re not crazy about, here are some resources that might help:

• How to Love the Job You Have
• Keep Your Job: 5 Ways to Be Indispensable
• How to Avoid Sabotaging Your Job