Economic future worries soon-to-be graduates

By Genna Tan

As families all over the country tighten their budgets in the wake of stock market fluctuations, students are worrying about the effect the economy's woes will have on their job possibilities.

"I've definitely thought about changing the path I'm going to follow after graduation," said finance major Jennifer Moyano. "I always thought I'd go to grad school after working for a couple of years, but now, because a job isn't guaranteed, I'm thinking about going to grad school right away."

The economic crisis stems from defaulted loans and is worsened by both a lack of confidence in the economy and a credit crisis.

The government's attempts at quelling fears by putting billions of dollars into solving the crisis has been met with even more panic.

On Wednesday, the Commerce Department reported a drop in consumer spending during September.

A wealth effect causes people to spend less, especially when they do not feel as financially secure as before, said accounting and finance professor Steven Wade.

The economy in Silicon Valley is not as vulnerable to the volatility of the financial markets as other parts of the country because companies here rely on innovation rather than investments, said Wade.

Kevin Carter, a finance major and intern for the social networking company Affinity Circles, said companies seem to like Santa Clara graduates.

"There are a lot of successful Santa Clara alumni, and at both of my internships, both of the students before me were Santa Clara students," said Carter. "Even at the Career Fair, there were many people who had the alumni stickers, so you could tell that they were affiliated with the university."

Silicon Valley companies are still keen on hiring Santa Clara students, especially those who have completed internships or have had prior work experience, said marketing professor Buford Barr.

"I don't see a significant decline in internships and entry-level jobs for university students, in particular, Santa Clara," said Barr. "Where I see the loss of jobs, very unfortunately, is in the more senior positions."

Barr said the senior positions are cut first because of the higher salaries. "I have some good friends who have been in the business a long time and who are having tremendous difficulty finding work after losing their jobs," he said.

With tighter budgets due to the recession, companies would rather hire someone who may have less experience but has more Web knowledge and requires less pay, Barr said.

Economics major Federico Escaler said that should help him with his job search after he graduates in December.

"I think companies still want to hire new graduates because it's cheaper to train them than to keep more senior people who have a higher salary," said Escaler.

"Companies still need new students and new energy coming into the company," said Kathy Potter, director of the Career Center. "Companies are going to experience large losses of people as the baby boomers start retiring at some point, and they will need new people."

Competition for jobs will become tougher when companies cut down on new hires due to budget constraints.

Barr said he hasn't noticed a panic on the students' parts.

"If the recession gets worse, there will certainly be a drying up of jobs," said Barr. "But I think Santa Clara students will be on the top of the demand list so maybe they will be less-affected than other college graduates."

Potter advises students to take control of their career opportunities by investing time in networking and preparing themselves ahead of time.

"Rather than sitting and stewing about the economy or getting scared or depressed, do more to prepare yourself," said Potter. "If it's going to be a tighter economy with less jobs, students need to be better prepared."

Students shouldn't change their majors because of the current state of the economy, but should look at the broader picture, she said.

"Don't panic and jump from something that you're good at or that you like, throwing it out of the window because you think that there will be nothing in it," said Potter. "Stay with what you want, get good at it."

She said students don't always understand the ways they can apply their skills to a career.

Barr said students should get ready way ahead of time.

"I would advise students to get more serious about being prepared for when you graduate because the competition is going to be greater than ever before," said Barr.

"I'm always amazed at the number of students who wait until winter or spring of their senior year to start thinking about getting a job, because they certainly need to start a lot earlier than that."

Consumer confidence is key.

Barr said, "If you think you're going to lose your job, if your parents or yourself have seen a buddy getting fired in the next cubicle, you're not going to go out and buy washing machines and cars and big items, you're going to hunker down and become conservative, and that ripples through the whole economy."

Barr said, "This is a very complex subject, there's a lot of emotion in it, there's a lot of greed and egotistical activities and lack of compassion for your fellow man."

He said, "All the things that we try to teach at Santa Clara don't seem to be practiced by many and it's sad."

Contact Genna Tan at (408) 554-4546 or gbtan@scu.edu.