5 ms·

It's been shown that, on average, people who enter the workforce during a recession earn less throughout their lives than people who graduate when the economy i

by gamble 18y ago

It's been shown that, on average, people who enter the workforce during a recession earn less throughout their lives than people who graduate when the economy is doing well.

rrf 18y ago
Can you substantiate that comment? Are you referring to salary/bonus growth being slower in leaner years? Is there a significant difference over a 40 year work life?
- ardit33 18y ago
  this is very known, and there has been lots of articles about it. You probably could google this yourself: http://www.portfolio.com/views/blogs/odd-numbers/2008/06/04/graduating-during-bad-economic-times http://www.portfolio.com/views/blogs/odd-numbers/2008/06/04/...
  - copenja 18y ago
    Read the article. The first study says the the income gap closes within 10 years. 10 years is not a "lifetime".
    - ardit33 18y ago
      That was done in Canada. The second one (done in the US) says: "Another study of M.B.A. students by Stanford economist Paul Oyer to be published in the Journal of Finance, found that having the bad luck of graduating during a bear market could slash lifetime earnings. Oyer estimated that during a bull market, someone who gets an investment banking job upon graduation earned an additional $1.5 million to $5 million throughout their lives when compared to someone who graduated during a bear market. This was in the 1990's, so it's likely to be even higher now. "
      - sethg 18y ago
        I don't see how this can be generalized to workers in general; investment banking is hardly a typical job.
tom_rath 18y ago
Meh. Those of us who entered the workforce during the last real recession in the early 90s (not the hiccup some techies wet themselves over in 2001) did just fine, thanks. Look, if you're planning to graduate over the next while, things are going to suck. Not "will I be able to get a job at cuulCmpny.com" suck, but "will I be able to both pay rent and eat" suck. Nasty, soul-crushing stuff that'll make you wonder if you were really as smart as you thought you were all this time. Just keep your head and you'll come out of it fine. Your character will be stronger, you'll have superb perspective and your long-term earnings will be spiffy. Don't waste energy worrying about whether or not you'll have a few more bucks on your paystub in 20 years. There are a whole ton of other factors which can affect that a lot more than the birth-sign of your economic zodiac.
- gamble 18y ago
  My comment was more concerned with the decision to graduate or stick around in grad school. The data suggests that you may be better off in the long term if you spend the recession earning another degree instead of cowering in a cubicle.
  - tom_rath 18y ago
    Well, for my own small sample of peers, those I know who took their chances in the workforce came out of the recession better than those who earned another degree (particularly if it was just 'something to do until things got better'). If you're planning to spend your life cowering, it really won't matter whether your choice is a cubicle or a classroom.
    - timr 18y ago
      Which recession? The last one (2002-2003) is a bad example, since many of the people who worked through it went crazy buying crap (i.e. houses, cars, granite countertops) with the flood of cheap credit that was used to "stimulate" the economy out of trouble. I spent that period in grad school, and while I don't have houses and cars, I also have no debt. I suspect I will end up better off in the long run -- we're just not there yet.
RobertL 18y ago
Bottom line here is. Figure out some way to start your own company and work for yourself. Boom or recession it's the only way to go.
lutorm 18y ago
Maybe, but if the question is whether to go to grad school or get a job, remember that as far as lifetime earnings go, you'll have to make up those 5-6 years of crappy salary when you get out, too. That's slightly different than just comparing those that graduate during a bull and bear market.

by gamble 18y ago

It's been shown that, on average, people who enter the workforce during a recession earn less throughout their lives than people who graduate when the economy is doing well.

rrf 18y ago

Can you substantiate that comment? Are you referring to salary/bonus growth being slower in leaner years? Is there a significant difference over a 40 year work life?

ardit33 18y ago
this is very known, and there has been lots of articles about it. You probably could google this yourself: http://www.portfolio.com/views/blogs/odd-numbers/2008/06/04/graduating-during-bad-economic-times http://www.portfolio.com/views/blogs/odd-numbers/2008/06/04/...
- copenja 18y ago
  Read the article. The first study says the the income gap closes within 10 years. 10 years is not a "lifetime".
  - ardit33 18y ago
    That was done in Canada. The second one (done in the US) says: "Another study of M.B.A. students by Stanford economist Paul Oyer to be published in the Journal of Finance, found that having the bad luck of graduating during a bear market could slash lifetime earnings. Oyer estimated that during a bull market, someone who gets an investment banking job upon graduation earned an additional $1.5 million to $5 million throughout their lives when compared to someone who graduated during a bear market. This was in the 1990's, so it's likely to be even higher now. "
    - sethg 18y ago
      I don't see how this can be generalized to workers in general; investment banking is hardly a typical job.

tom_rath 18y ago

Meh. Those of us who entered the workforce during the last real recession in the early 90s (not the hiccup some techies wet themselves over in 2001) did just fine, thanks. Look, if you're planning to graduate over the next while, things are going to suck. Not "will I be able to get a job at cuulCmpny.com" suck, but "will I be able to both pay rent and eat" suck. Nasty, soul-crushing stuff that'll make you wonder if you were really as smart as you thought you were all this time. Just keep your head and you'll come out of it fine. Your character will be stronger, you'll have superb perspective and your long-term earnings will be spiffy. Don't waste energy worrying about whether or not you'll have a few more bucks on your paystub in 20 years. There are a whole ton of other factors which can affect that a lot more than the birth-sign of your economic zodiac.

gamble 18y ago
My comment was more concerned with the decision to graduate or stick around in grad school. The data suggests that you may be better off in the long term if you spend the recession earning another degree instead of cowering in a cubicle.
- tom_rath 18y ago
  Well, for my own small sample of peers, those I know who took their chances in the workforce came out of the recession better than those who earned another degree (particularly if it was just 'something to do until things got better'). If you're planning to spend your life cowering, it really won't matter whether your choice is a cubicle or a classroom.
  - timr 18y ago
    Which recession? The last one (2002-2003) is a bad example, since many of the people who worked through it went crazy buying crap (i.e. houses, cars, granite countertops) with the flood of cheap credit that was used to "stimulate" the economy out of trouble. I spent that period in grad school, and while I don't have houses and cars, I also have no debt. I suspect I will end up better off in the long run -- we're just not there yet.

RobertL 18y ago

Bottom line here is. Figure out some way to start your own company and work for yourself. Boom or recession it's the only way to go.

lutorm 18y ago

Maybe, but if the question is whether to go to grad school or get a job, remember that as far as lifetime earnings go, you'll have to make up those 5-6 years of crappy salary when you get out, too. That's slightly different than just comparing those that graduate during a bull and bear market.