Recession. It is a frightening word that most people would rather not think about nor acknowledge. “I wouldn’t say we’re in a recession,” said Janette Wagner, Assistant Vice President of Capital City Bank on north Monroe street, “I’d say it is more of an economic concern.” The economy has begun to see setbacks across the board with the cost of homes rising, gas prices soaring, and the worth of the dollar decreasing.
For college students, it is important to be aware of the problems they could be facing and know what to do to protect themselves against economic hardships.
One thing Wagner suggests is, “picking a major that’s going to secure a job for your future.” Yahoo! Hot Jobs produced an article this year of “Recession-Proof Jobs in 2008,” listing careers that are expected to remain strong during a possible recession. The list included careers in education, energy and health-care. Wagner continued, “You need to judge a career path that coincides with your degree.”
Having good credit is another important factor in a recession, and Wagner recommends students in college build good credit. She went on to mention that ways to do so “include managing a credit card by making small purchases that students are able to pay off at the end of each month or securing a small loan by pledging their savings account and then paying it back in monthly installment.” A critical piece in building credit is consistent and timely repayment she adds.
“Start thinking smart already. Never buy something you can’t pay for at the end of the month.”
Dr. Clyde Ashley, an associate professor of professional development in School Business and Industry with a background in economics, agrees.
He knows the importance of having a good credit score – recession or no recession – and wants to pass that along to students. “It is serious,” Ashley said. “Students should make sure they monitor their credit score, don’t gain debts or a lot of credit cards.” He suggests that with interest rates being so high, and in case possible setbacks do occur, students should limit their amount of credit cards to one or two at the most. Keeping the balance at zero will lead to good credit, he assures.
Wagner suggests that if students pick a major to assure them a job during an economic slump, when the economy turns, they can always go back to school to pursue something different. But with a recession making banks and financial institutions reluctant to give loans, it would be even harder for students to obtain money to return to school.
A recession may lead to budget constraints for universities. As educational services are cut, students at a college level would be directly affected as tuition and fees could increase. “It puts students in a difficult position. They then have to rely more on student loans,” Ashley said. “Students are aware of a recession’s impact because they’re feeling the pinch.”
Porsche Haynes, a senior public relations student from Mons, Belgium, said she definitely feel the pinch at her job. She explains that at the restaurant she works at, a lot of her income comes from tips. But, the economic downturn is causing less people to go out to eat. “It hurts me and it definitely hurts servers,” she said. “Tips are untaxed.”
Graduating in the spring, Haynes knows what to expect as she enters a more competitive job market, if a recession continues on. Her father, she said, stressed to her the importance of being proactive in the search for scholarships and being able to leave school with little to no monetary burdens. “One of my crowning achievements will be that I’ll be leaving college debt free,” she says.
Budgeting and having a savings account are two good ways to supplement your income while in school, Haynes adds. “I set money aside for things that I need. Then when I really want something, whether it’s a pair of Steve Madden shoes or anything else, I have a “wish jar” that I label and deposit money into,” she said. “I don’t touch the jar until I have the full amount of money to get what I want.”
Dr. Ashley advised additional information for students to keep in mind is having a good GPA, internship experience, and work towards developing rock solid resume. This way student can “intelligently monitor the job market and be able to market yourself.”