The New York Observer: Staying in School Longer

by Jillian Blume

When students today approach their college graduation, it isn’t inspiring the same sense of celebration as graduations did a few years ago. Instead students feel more of a sense of dread as their graduation date approaches.Recent statistics show that over 15% of people aged 20 to 24 are unemployed. And with the job market flooded with highly motivated, experienced workers, an MBA doesn’t have the same power it once did. According to the National Association of Colleges and Employers’ Job Outlook 2010 Fall Preview, hiring is down 7% for the class of 2010. As recent graduates struggle to find a job without success, the idea of staying in school longer begins to make more sense than joining the ranks of the unemployed. “We have historical, quantitative date to suggest that anytime we have a downturn, graduate enrollment picks up. People don’t rush to get out into the job market when the job market is weak,” says Linda Barrington, Managing Director of Human Capital and The Conference Board. “This is the time when the reality is really hitting the graduating class because they start looking for jobs now. They usually have offers by February and March, and that’s just not going to happen this year.”

The Beginning of a Shift

Typically, students who consider graduate school will take a few years off to get some real world experience and decide what they really want to do. “I have seen the beginnings of a shift,” says Chris Ajemian, CEO and founder of CATES, a tutoring and test prep company based in New York. “I think the job market right now is definitely having an impact on student choices, and potentially at the expense of their own personal development. The trend used to be that students, for the most part, took a year or two between undergraduate and graduate school. They would go get a job, experience what it was like to make a living, and then when they had a better sense of what they wanted to do, they’d go to graduate school. But there are signs that that has changed.” Some of the students he has been working with have decided to go directly to graduate school to avoid being caught up in what’s become an ultra-competitive and difficult job market. “We have students right now who are beginning their senior year of college at schools like Columbia University, NYU, Hunter, and at schools outside New York, who are beginning their GRE, GMAT, LSAT prep stuff a year earlier right now, so they have options upon graduation.” Ajemian has found the trend to stay in school longer even affecting high school students. “The volatility of the job market and the potential volatility of it down the road definitely has affected these people’s choices. Even on the high school level, I’m noticing that a lot of students are considering programs like the one at Brown University, which guarantees a spot at the Brown Medical School.” According to Andrew Yang, CEO of ManhattanGMAT, there’s been a lot of research that’s shown that graduating into a recession can hamper your professional development substantially. “When the economy recovers, companies often recruit directly from schools rather than from people who graduated several years ago. The research shows that if you graduate into a recession, it can set your career back substantially even beyond when the economy recovers. So there actually is a good amount of conventional wisdom behind going on to grad school if you’re graduating right now.” Applying to business school right now is betting on the state of the economy in 2012, which for many young people sounds like a very good bet. “I think that a lot of students are having a hard time finding jobs,” says Kelly Stephenson, a student at the University of Tennessee at Knoxville. “It’s very competitive, and there’s not many positions open. There’s a new trend to stay in school longer while the economy is flailing. It’s just the better option, and then that will give them more credibility toward their major.” And since the pattern of the economy is cyclical, she notes, they’re hoping by the time everything starts picking up and businesses are doing well enough to hire new people, they will be more competitive when they actually do go into the job market. On the other hand, she has heard about some negative repercussions to staying in school to sit out the recession. “Some employers are noticing that more students are going into masters programs, and when they graduate, they are a little bit more hesitant to hire them because they think that these students who went right into masters programs just didn’t want to face the recession and didn’t want to go out and be competitive and really look for a job.”

Betting on the Economy

Joshua Tauber had originally planned on getting some work experience before going to graduate school, but the job market made him reconsider his options. He found out as a sophomore at Cornell University that The Johnson School (at Cornell) was accepting students directly from the undergraduate school, and he discovered that he had a difficult decision to make. “I met with the dean of admissions at the school. I spoke to a lot of employers who were coming to campus, particularly corporate recruiters. I spoke to professors. I got a lot of very mixed opinions.” On the positive side, he considered the people who had gone directly into the program in previous years. The dean of admissions said that students who made it through in five years had job offers that were very comparable to students that were coming through at 27 or 28 years old with work experience. On the negative side, he spoke with a recruiter for one of the investment banks, who told him that it was a big mistake to go right into graduate school without getting any work experience. Companies might not know what to do with him. “I might be overqualified for entry level positions and under qualified for a management position,” says Tauber. He took the GMAT last fall. “It was pretty much the worst imaginable time to think about getting employed, and that was the point that I made the decision. I didn’t know what the conditions were going to be in eight or ten months when I would have been graduating, but there were a lot of negative market forces going on a year ago when I was making the decision. I had friends who had just finished their senior year three of [sic] four months before who had offers at Lehamn Brothers, and so the economy was definitely significant in terms of my decision.”

A Difficult Decision

There are obviously some repercussions when students decide to delay their entrance into the real world. They will not have a chance to try out different types of jobs and figure out where their talents lie. They will put off a critical period of discovery, in which people learn who they are and mature into adults. It also guarantees that students will graduate with a lot more debt. On the other hand, when students finish an advanced degree program, they will have a greater understanding of their field. The economy might be a lot better too. And graduates can benefit from advanced on-campus recruiting. According to Andrew Yang, it’s more efficient for employers to find a concentration of recent graduates by doing on-campus recruiting at a business school, law school, or a college because they can see dozens of people lined up for them. It’s a lot easier for a company to identify those groups than it is to find people who graduated two or three years ago and are scattered across the landscape. “It’s not necessarily deliberate on the part of employers, but it just happens in practice,” he says. “Also, many people who graduated a couple of years ago might be employed outside a given field, they might be a little underemployed, they might be doing temp jobs or part-time jobs, so it’s not a natural pipeline for some of these employers.” Jennifer Kushell, president of ysn.com (Your Success Network), believes that graduate school may be a way of saving face. “One of the big challenges with this generation in particular is that they’ve been so heavily coached their whole life that a lot of the answers have been laid out for them,” she says. “They haven’t had to think as independently as other generations have, and so when they’re put into a position where they’re thrown out into the real world today, a lot of them are getting stymied. So their answer is to maintain a clear path, which is graduate school. You’re obviously successful if you’re in graduate school because it’s a very difficult level of education to obtain.” Being in graduate school gives you an immediate answer to the question of what to do with your life. “There’s certainly pluses and minuses to staying in school for extended periods of time without ever having had a job,” says Yang. “Certainly some degree of real world experience is helpful for people to form their professional ambitions. It’s really an unfortunate effect of the recession that a lot of people aren’t going to be exposed to some of the professional experiences that they had planned on being exposed to. Pursuing graduate school is like the next best thing.”