Even though no one quite knows when exactly the upcoming recession will strike, economist Harry Holzer says newer college graduates are among the first to be targeted by employers in an economic downturn. Their lack of experience in the workplace makes them less valuable than others.
Everyone should be preparing regardless, however. The debt-based system we all are being forced to live under will not last forever, and when it comes crashing down, there will be incredible financial catastrophes for both businesses and individuals.
According to a report by Yahoo, during the Great Recession, which lasted from December 2007 to June 2009, and during the 2001 recession which Americans endured for eight months, new college graduates were the most likely to be laid off. Holzer, who is a Brookings Institution economist, said: “Young people get hit the hardest during a recession and that will include young college grads. It will take them longer to find any job, and it will take longer for them to find the jobs they really like in terms of beginning a career.”
Signs have been surfacing for months now that the recession is on the way, so preparations should be made to mitigate the financial stress of a recession. Both in the US and globally, these signs are appearing more often and more severely. U.S. manufacturer growth slowed to the lowest level in almost 10 years in August, according to results from IHS Markit data. And last week the Federal Reserve reported that manufacturing output fell 0.4% in July from a month earlier, and was 0.5% lower compared with a year ago.
The government has also been whitewashing the jobs numbers.
And a closely watched part of the yield curve inverted on August 14. The yield curve is a powerful and accurate predictor of an economic downturn, and an inversion has preceded each of the last seven recessions dating back to 1969.
The time to prepare was several months ago, but if you are just getting around to it, it never hurts to start now. Limit liabilities and stash some extra cash away. It never hurts to buy gold or silver either – not as an investment, but as insurance. You could also consider picking up some kind of passive income.
In his book, Don’t Save for Retirement: A Millennial’s Guide to Financial Freedom, Daniel Ameduri outlines ways to become financially free without having to save for retirement. When he was twenty-seven years old, Daniel was on the brink of bankruptcy. A decade later, he’s a multi-millionaire, having taught himself about economics, investing, and other money matters that he never learned at school or at home. The expert guidance he provides in Don’t Save for Retirement: A Millennial’s Guide to Financial Freedom will help you:
· Redefine wealth as a philosophy, not a dollar amount
· Turn passion projects into viable business plans
· Cut unnecessary spending in unexpected places
· Start generating passive income now!