While sitting in the Dayton airport for two hours waiting for my continuously delayed flight out of Ohio for fall break, a woman saw me flipping through an LSAT book and saw this as an opportunity for conversation. She made typical small talk and inquired about my major. When I responded journalism and economics, she laughed. She didn't even try and do a subtle, covered laugh but actually turned to the man next to her and said "Ha! This one expects to make it in a field that isn't engineering or medicine." He joined her, and they had a great laugh at my future's expense. They both told me to stay in school as long as possible, get used to living with mommy and daddy and accept the fact that the best years of my life are over.
I am stubborn and refuse to believe that. Despite unemployment reaching almost 10 percent, a career fair with fewer employers and the looming end of Friday afternoon naps, I don't believe the best is over. Instead, I think now more than ever is the time for creativity and innovation. As graduating seniors we have to find a way to make this system work for us. We have to be prepared for changes.
In economics there is a theory of business cycles. There are troughs and peaks in the Gross Domestic Product (GDP) and indicators that lead and lag these ups and downs. We are definitely in a low point, but if the theory holds true there has to be an up sometime.
Unemployment is countercyclical, meaning that during a time of recession unemployment increases and with recent unemployment at almost 10 percent this recession seems to be following cycle. But looking at the history can also bring hope, if we stay open minded and look at the big picture. This is not to say these aren't difficult times or there aren't many recent college graduates still looking for jobs, but let's not get too depressed before gaining some perspective.
Recessions have become more infrequent and for the past 20 years there have been only three severe ones. This has been called The Great Moderation, and one of the reasons for this is financial innovations. In the 2005 meetings of the Eastern Economic Association, current Chairman of the Federal Reserve Ben Bernanke attributed the decline in economic volatility to structural change. These changes include better inventory managements and more depth in the financial market and have improved the economy's ability to better absorb shocks. Bernanke also cited better macroeconomic policies and the use of monetary policy to moderate output and inflation. And the third piece of the moderations includes good luck as an explanation of the "phenomena."
It is hard to think of this recession as moderate with high jobless claims and the fact that some financial innovations once credited for creating stability and an increase in the flow of credit have caused the problems they sought to stop. It is easy to see all of these as problems and be even more apt to agree with the stranger in the Dayton airport about the negative future that awaits graduates, but again I'm being stubborn and refuse to only see the bad.
Although innovations such as consolidated debt agreements and swapping of debt have gotten us into this mess, new innovations can help get us out. The financial world now more than ever needs smart, driven and creative young minds to develop financial instruments. Not ones containing wordy fine print, but rather innovations that instill confidence in the system and yield reasonable returns that will rebuild confidence among investors. Your four years of college don't have to be the best of your life. You may not find your dream job right away, but be assured the world does need you, now more than ever before.
This recession can also be seen as an opportunity for both citizens to understand the Federal Reserve better and the Fed to learn. The government has used monetary and fiscal policy to try and stabilize the cycle, similar to the use of a dome to stabilize a weather cycle. But once the Fed weathers this storm, it can look at root causes of the crisis. A large part of the crisis is emotional. Herd mentality and irrational exuberance caused people to think the housing market was gaining because of real changes in asset prices. Does this mean there should be more regulation, or is the problem letting banks become too big too fail? These are questions that our generation will have the opportunity of addressing, and we should remember to see it as just that, an opportunity.
While college is great and probably some of the best years of our lives, I refuse to believe it can't get better. I refuse to look at May as the end, but rather (yes I know its cliche) the beginning of opportunities we can find using creativity and innovation. The world does need us, maybe in jobs that didn't even exist a year ago. We may not be living the dream anymore, but we certainly can make our situation work, for the country and us. Let's learn to dance in the rain.
Enjoy what you're reading?
Signup for our newsletter
Read More
How one professor and her classes are preserving Oxford’s Black history
By Sean Scott | March 20, 2024Jazma Sutton, an assistant professor of history, teaches The Black Midwest (HST 350Q) and Black Women in America (HST 450D) classes. In both courses, she has students working with the Smith Library of Regional History and Miami’s archives to document and preserve Black history in Oxford.
Miami faculty members recount Freedom Summer in new documentary
By Luke Macy | February 25, 2022After seven years of work, “Training for Freedom,” a documentary highlighting Oxford’s involvement in the Freedom Summer of 1964, premiered on PBS Western Reserve on Valentine’s Day.
“Documenting the COVID-19 Pandemic”: History in the making
By Alice Momany | August 29, 2021In March 2020, Miami University’s archives launched “Documenting the COVID-19 Pandemic,” a collection focused on life during the COVID-19 pandemic.