25 and jobless: How this pandemic is impacting Millennials and Gen Zs

Health & Education

Job searching is stressful. However, last year added a pandemic and furlough schemes to the mix.

The UK unemployment rate increased up to 5.1%  throughout the months leading into December and company payroll numbers are down 726,000. Almost three-fifths of those unemployed were younger than 25. In total, 1.74 million people were unemployed from October to December, up 454,000 from the same quarter in 2019.

Jonathan Athow, ONS deputy national statistician for economic statistics, said “Our survey shows that the unemployment rate has had the biggest annual rise since the financial crisis.” 

Furlough has also added in uncertainty on measuring those who are working or are looking for work. When the furlough scheme ends, there will be an estimated six million people wondering what will happen to them. The Bank of England forecast the unemployment rate rising even higher up to 7.8% later in the year.

As someone who falls right in between a Millennial and a Gen Z (I was born in 1997), I can empathize with my fellow peers. Younger generations in the U.K are more likely to work in the sectors most severely impacted by the crisis, such as hospitality, the care sector, retail, and the service industry. The younger generations will have the most challenges emerging after lockdown.

The Millennials had a rough time with their careers, with the last recession ruining their career prospects. The 2008 financial crises left them coming into their adulthood with a pessimistic job market, while they were left with an enormous amount of student debt. Furthermore, Millennials are struggling to buy their first home amid high price-to-income ratios. Unlike previous generations, the Millennials face problems of accumulating wealth, buying properties, and starting families.

With this pandemic, the Millennials are left once again with a failing worldwide economy. The generation should be in the prime of their careers, yet they are facing the bulk of layoffs from jobs, no equity in housing, lacking much savings or a strong career to fall back on. 

Gen Z’s are facing a similar situation that the millennials faced with the last recession. They are coming out of college into an economy that has left them stranded. Some Gen Z’s are trying to assimilate to online learning, which has been very difficult.

Right before the pandemic, Gen Z’s were coming into economies with low unemployment. After the pandemic, entry-level jobs were rescinded and internships were cancelled. According to the Pew Research Center, Gen Z’s were the most likely generation to be laid off during lockdowns. Their ages from 18-24 made them very vulnerable in most industries. However, unlike the Millennials, most Gen Z’s aged 19-21 who have not entered the work force might be spared from career setbacks and financial ruin if the economies of most countries are able to bounce back this summer. However, if the pandemic is prolonged, they will face a similar outcome as the Millennials.

It is obvious that covid impacts the physical health of the older population, but the younger generations have been impacted in terms of financial health. I think it is important to recognize that younger generations are dealing with a lot of uncertainties about their future. Gen Z’s and Millennials are suffering with their mental health because of online learning and unemployment. Some countries are doing what they can to help the younger generation and their financial health. 

U.S President Biden has stated he supports the plan to cancel $10,000 worth of student debt per borrower, after canceling $1 billion worth of student debt for students who were misled, defrauded, or otherwise harmed by predatory colleges and universities. He has also cancelled student loan repayments until September of 2021 to give students relief during the pandemic.

In the budget for 2021, Rishi Sunak said it was “vital” to continue to get younger people back to work. The chancellor plans to include a “flexi-job” apprenticeship scheme that will allow apprenticeship to work with a number of different employers in one sector. 

Currently, firms are given £2,000 for every new apprentice under 25 and £1,500 over 25, in addition to a £1,000 grant firms are getting in another project. Rishi Sunak promises to increase the cash incentive for firms up to £3,000 for an apprentice, regardless of age. In total, the government plans £126 million investment to allow more than 40,000 apprentices.

The plans proposed will allow the younger generation to get back onto their feet.  Here at Polestar we will shortly be taking on another career starter as will hopefully many other firms as we come out of lockdown.

Jonathan Athow, ONS deputy national statistician for economic statistics, said “Our survey shows that the unemployment rate has had the biggest annual rise since the financial crisis.”

By Anusheh Khan on 29/03/2021