Economy woes worry students
Concerns for the U.S economy are in the minds and hearts of investors, workers and graduating seniors at GCSU.
After the Federal Reserve cut three-quarters of a percentage point of a key interest rate last Tuesday, many are speculating that the economy has already been worse off than anyone originally thought; we are most likely heading into a recession. If so, it will be the second in less than 20 years.
“A recession is defined as two consecutive quarters of negative growth in GDP (Gross Domestic Product), the last official recession in the United States occurred in 2001,” said Dr. James Arias, associated professor of economics at GCSU. “The chance of a recession happening now is the highest than it has been since 2001. However, we really do not know if we have entered into a recession yet. Data must be collected and analyzed; we may not be certain for at least four months from now.”
Dr. Xu, professor of economics at GCSU said, “Recession is a part of the business cycle. Just as the country experiences booms and peaks in growth, it also experiences recessions.”
However with recessions comes less funding for GCSU, a harsher housing market, and the loss of jobs for many.
An economic recession will create funding issues for the college.
“Georgia College will be affected because we receive funds from the state. If the state does not have enough revenue it will cut spending to balance its budget, ultimately giving the school less money,” said Xu.
The Milledgeville housing market is a perfect example of a market that has seen better times. With a possible recession on the way, there may be more “For Sale” signs springing up around town. People paying a mortgage for a home beyond their budget may find themselves without the ability to pay back their loan, in most cases, a sub prime loan. Sub prime loans are for those with low incomes and low credit scores.
“The slowdown will affect the job market. As firms do not hire as much, students, especially graduating seniors, will be directly affected,” said Arias.
Many may find that a job offer they received before graduating may not turn into a reality if the slow down in the market continues.
“If a student graduates in May and finds there to be no jobs available for her, it could have a very large impact. A ripple effect could occur; causing current juniors and sophomores to be affected as well,” said Xu.
A back-up in the job market is not something anyone in college is looking forward to.
“This could be really crappy, especially for me. It’s hard enough to find a good job as it is. It sucks; I’ll probably have to work at Starbucks or something and have to wait to do something with my major. I guess that’s something I’m going to have to accept,” said Colleen O’Hara, a senior at GCSU.
This may be something many students may have to accept as well.
Jessica Yount, a senior at GCSU said, “It is frightening to think that when I finally enter into the real world and the job market I won’t be accepted. I’m a senior but I’ve decided to stay an extra year to graduate so I can get a second major.” This might be one of the best routes for students to travel.
With an almost inevitable slow down in the economy approaching many may be scrambling for new ideas. Some much needed advice for seniors and students alike could be surprising.
“Graduate school could be another option for students. If the alternative is a job market without the jobs, take extra steps to get noticed. Don’t rush. Take your time getting through school,” said Arias.
Standout from the crowd, take internships and study abroad. Consider graduate school.
The official dating of recessions and business cycles is done by the
National Bureau of Economic Research (NBER). For more information, visit http://www.nber.org/cycles.html.
Posted by Colonnade Archives
on Feb 1 2008. Filed under News.
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