If you graduated from a private university in 1982, your tuition and room and board would have run about $5,000 per year -- or $20,000 for a four-year undergraduate degree. When you graduated, the employment environment was equally dismal to what we face today (unemployment was 9.7 percent in 1982 -- even higher than the 9.2 percent figure released for June, 2011). Yet at that time, the average entry-level salary for a new graduate was $22,450 -- which meant that in a single year, a college grad with an entry level job could earn back basically all of his or her entire education cost. In today's market, accomplishing this feat would require, roughly, a $200,000 entry-level salary. Hardly typical.
In 1982, one could rent an apartment in a new luxury building with a doorman on the Upper West Side of Manhattan for less than $500 a month -- utilities included (My parents' UWS apartment that ran under $500 per month in '82 is currently on the market for $2,700 per month). What this means is that a generation ago, as a recent graduate facing similar unemployment numbers, when you did get a job, not only could you afford to live, but you could afford to live well. Even in New York City.
Today, a recent graduate woke up to the news that unemployment is now 9.2 percent and escalating. His or her BA, assuming they attended the same private university as the person from 1982, would have cost roughly $35,000 to $50,000 per year, or close to $200,000 all-in. That's approaching ten times what it cost a generation ago. The same apartment that was affordable on an entry-level salary in New York back in 1982 now runs about $2,400 per month, or roughly five times what it cost thirty years ago.
And as for that entry-level salary? For many, it simply doesn't exist. And not just because of a floundering economy or because Washington is failing at "job creation," but because many recent graduates must now "intern," post graduation, for little or no pay in order to generate the competitive resume necessary to get a "real" job -- the old fashioned kind that comes with a livable wage and benefits.
A generation ago, despite high unemployment, it was almost unheard of to intern after graduation. But college students today have become so comfortable -- and employers so enamored -- with the concept of the no pay/low pay internship undertaken for college credit or in lieu of a summer job that it has spilled over into the entry-level job market. The post-graduate internship has, in many cases, replaced the entry level job, which is creating a ripple effect across the entire marketplace. The fact is, the job market has been flooded with a pool of highly educated and very cheap labor.
So the question we should be asking isn't how Washington can create jobs, but rather what we can do to stem a sociological, generational and corporate trend that is boxing out anyone who doesn't have the resources (i.e. parental subsidy or the willingness/ability to take on debt) to pay ten-fold for their college degree, five-fold for an apartment, and accept a 100 percent reduction in compensation -- sometimes for months or even years after graduation -- in order to gain the resume-building experience now necessary to qualify for competitively paid employment.
Then we should step back and ask what happens to the job market when a highly educated segment of the population makes itself available to work for little or no pay. How much of a contributing factor to current unemployment is the fact that corporate America is capitalizing on the large group of well-educated, often debt-straddled job seekers willing -- or systemically forced -- to "intern" before they can get "real" jobs? And what happens to those who simply can't afford to play the game? This phenomenon is creating a sociological exclusion -- a restrictive financial gate -- for lower and middle-income parents and their newly graduated children.
So, when we look at the June unemployment numbers, we have to note that we are grossly underestimating just how dismal the current economic picture is. We then must decide whether or not we have to do more to legislate -- legally or morally -- against this generational and corporate trend toward post graduate low/no pay internships and what amounts to underemployment by proxy. If the corporate climate is such that a segment of highly educated, upper middle class, entry-level workers are willing to work for free or a stipend in order to be competitively qualified for a "real" job down the road, then how can the rest of the workforce compete to put food on the table, pay down debt and support themselves and their families?