History has a weird habit of repeating itself.
When I studied economics, we were told by our professor that not only the economy moved in cycles, but that events repeated itself, be it in different places and with different players.
When you look at what is happening in Europe you can see history happening all over again. The European economy suffers from over-inflated credit, financial and property markets. Japan suffered a similar situation in the late 1980′s and they ‘lost’ a decade.
When you look at what happened in Japan we can see what might (will?) be happening in Europe.
Governments and companies will reduce their funding of pensions and employees will have to pick up the bill themselves. Various governments have also increased the retirement age, meaning that people will have to pay longer into their retirement funds and start benefiting from them later.
More job insecurity
As the number of people in secure, permanent employment will decrease, the number of people in part-time and freelance jobs will increase. Companies will want to remain competitive and this is one way of doing that. Germany for instance coped with the crises by reducing the number of hours people worked in order to save their jobs. In Holland more people became self employed in their own jobs enabling companies to be more flexible.
Technology will increasingly enable companies to do things faster with fewer people, meaning that middle management positions will increasingly disappear. This will also lead to lower pay and increased workloads as fewer middle managers will have to deal with more lower educated staff, doing more work.
Lower job satisfaction
All these downward pressures mean that there will be fewer jobs for graduates, something already obvious in the UK job market. It will result in more graduates taking on non-graduate jobs, pushing lesser educated people into even lower paid jobs. People will end up feeling not very satisfied with the work they do. On top of that the pay gap will widen as evidenced in the UK. Bankers are in a position to pick up (Or reject, be it under duress, Steven Hester @ RBS) million pound bonuses where the average worker sees the cost of living increase and their salaries not keeping pace. Another side effect will be that graduates will start emigrating to countries where they will be paid according to their educational level. Lots of Irish graduates are moving to Australia and a similar brain drain is going from Portugal to Brazil.
Is it all bad news?
Yes and no, it depends on how you look at things. If you’re willing to move where the jobs are, learn another language, set up your own company, widen your experience beyond what you were trained for and be pro-active, you will be able to carve out a future for yourself. The main thing is not wait until work comes your way. It might never come.
So, research your industry. Which companies are growing, where are they based, what type of people do they need, are there new, fast growing companies? Can you form a new company with colleagues? Think outside the box, be willing to look at work in a different way and take new challenges in your stride.
The economic downturn might cause a lot of negativity, but there is always an upside. Look for the upside and you will have a thriving career. (But it might not be the career you originally set out for….)