More Than a Decade Later, Many Affected by Recession Have Not Bounced Back

By:
Chris Gaetano
Published Date:
Sep 10, 2018
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More than 10 years after the global economy came perilously close to complete and total collapse, many of those caught in the wake of the crisis have yet to meaningfully recover, according to CNBC. To illustrate what exactly this means, CNBC featured a man who, prior to the economic crisis, had been in automotive marketing. After losing his job, or rather after his job ceased to exist, he eventually wound up as a photographer at a Florida theme park making about $25,000 year, a fraction of his previous income. He has never worked in his original field since. In a survey conducted by the Transamerica Center for Retirement, 37 percent of respondents said they have only somewhat recovered, 12 percent said they have not begun to recover and 7 percent expect they will never recover from the financial crisis. 

During the financial crisis, many workers shifted into either part-time jobs or full-time positions for which they were overqualified. Consequently, one study found that nearly one third of adults who were raised middle class actually experienced downward mobility following the recession. This effect could explain why so many of those affected by the recession still struggle. A recent report found that those who leave college underemployed are more likely to remain underemployed even a decade later. It also found that those who backslide from employment in a relevant field to underemployment in a part-time job also struggle to regain their position: 13 percent of graduates go from a bachelor's level job immediately following graduation to a sub-bachelor's position five years later. Of those, two thirds remain underemployed 10 years after later. For both those who backslide and those who are underemployed right after graduation, a primary reason is that the time they spend at survival jobs is time not spent developing relevant skill set, making industry contacts and accomplishing things that would make them attractive to future employers. 

This decline in upward mobility could also be a reflection of overall social stagnation, though: Another recent study found that number of people who wound up at better jobs than their parents has been slowing down over the past few decades, going from two-thirds for those born in the 1940s to just over half for those born in the 1980s. The paper said that this substantial decline in absolute mobility reflects the changing distribution of occupational opportunities in the American labor market. 

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