Changing Times: How the Economy Affects Generation Y Professionals

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Temporary jobs and tight budgets are becoming all too familiar for many Generation Y professionals, who are facing a seemingly permanent recession. Average incomes in the US for those aged 25-34 have fallen 8 percent since the recession began, which is double the adult population’s total drop, and their unemployment rates are one-half to 1 percent above that of the national average. The nation’s younger workers have benefited least from the economic recovery. It is thought that this generation will be stuck on a lower-income path, and in a difficult job market will remain in careers other than their first choice, long term. Of course, this makes it less likely for them to start over again in preferred fields.

This status is understandable. In a post-recession world every dime counts, and companies know their success is a matter of return on investment and market share. It takes a thoughtful strategy for a company to remain competitive and prosper in the marketplace, all while retaining their desired headcount, keeping employee morale high and staying within the confines of strict budgets.

Nearly half of the human resources professionals belonging to the Society for Human Resource Management reported that their companies were somewhat or very likely to keep their reduced budgets for the foreseeable future. Some of this reduced budget is reflected in more companies choosing to outsource entire initiatives and company functions, rather than taking on new staff. Here are some ways companies are adjusting:

Outsourcing and Contractors: Utilizing contractors and temporary help to fill holes, rather than bringing on full-time employees, can cut down on benefits costs and can be budgeted on a per-project basis rather than long-term salary budgeting. As a result, fewer people commute to inner-city offices and workplaces every day.

Virtual Work Environments: Companies that can embrace a virtual workforce not only benefit by saving on costs, but in other areas as well. A study at Brandman University found 40 percent of employees from large, enterprise and Fortune 500 organizations worked in virtual teams. The study also found that virtual teaming helps companies recruit the best talent (no matter the location), allows for flexibility, creates more revenue in other markets and reduces travel and office expenses.

Commercial Use Changes: Stricter loan underwriting, a higher percentage of empty storefronts and tighter budgets across the board have drastically affected the use of commercial and urban spaces. Temporary, mobile and recyclable spaces paired with a need for adaptation and experimentation have spurred a new collaborative energy.

The professional impact of the current economic climate has impacted Gen Y’s behaviour. Younger people chose to drive less in 2012, with many of America’s younger adults preferring to live places where they can easily walk, bike and utilize public transport. Changes in mobile technology, fuel prices and driving laws have contributed to a rise of alternate transportation, according to a U.S. Public Interest Research Group report. Between 2001-2009, the average number of vehicle miles traveled by those age 16-34 dropped by 23 percent, with the same group taking 40 percent more public transit, 24 percent more bike trips and walking 16 percent more. These individuals reported most valuing bus routes and rail lines, increasing demand for these services in urban areas.

Claire Perkins has a background in print and digital publishing. She can often be found amid a cloud of Law & Order SVU and Cinnamon Dolce Lattes.

Image via mikecogh