Talk of recession in the news, soaring inflation, the war in Ukraine, and the recent failure of major banks makes many people fear what the future might hold. Some economists are sure that a recession is coming, perhaps as soon as the year is out, while others are hopeful that we may see a period of slower economic growth.
The recession is hard for everyone, including veterans. A study of hiring veterans during the two most recent recessions reveals ways veterans can prepare for their future and hopefully avoid unemployment.
How have veterans’ jobs fared in recent recessions?
The recent RAND study entitled Hire veterans during recessionsExamines the career prospects for veterans who were separated from the service during the Great Recession of 2008 and the COVID-19 pandemic of 2020.
Recessions had different causes, affected different industries, and lasted for different lengths of time. While it was unique, it revealed some interesting trends for veterans who were in or entering the workforce at the time of the recession.
Each recession affected different industries. Since veterans tend to gravitate towards industries such as manufacturing, they were affected most during the Great Recession when industrial employment declined.
But industries like travel and entertainment have been affected more than manufacturing during the COVID-19 pandemic, and veterans are less likely to be employed in those industries. As a result, veterans have not been experiencing unemployment during the COVID-19 pandemic at the same rate as their non-veteran counterparts.
What about new veterans?
“Historically, workers entering the labor market during an economic downturn earned lower wages and experienced higher rates of unemployment, with the effects lasting for years or decades,” the study says.
Besides facing potentially lower wages, newly separated veterans may face the added challenge of finding a job at all.
While unemployment remained lower for veterans than the general population during the Great Recession of 2008 (peaking at 7.9% for older veterans compared to 9.2% for non-veterans), it was not the same for veterans who returned to the workforce during the slack. The unemployment rate for veterans peaked at 13.9%, much higher than for non-veterans.
However, the opposite has been true for the COVID-19 pandemic. Non-veteran unemployment rates peaked at 14.5%, while rates for veterans and new veterans were lower at 12.1% and 12.9%.
While unemployment rates have varied, veterans who hold full-time jobs during recessions still earn nearly 20 percent more than their non-veteran counterparts.
Recently separated veterans need more support
Veterans face unique challenges as they enter the workforce. Their work experience may not seem to translate well in the public domain. They may also need to create a resume, choose where to live, and apply for jobs – all for the first time ever. Faced with a potential impending recession, what can veterans do to ensure they get back on their feet?
Choosing a “recession-proof” industry may not be possible, because it is difficult to identify which industries might be affected by a future recession. However, organizations can provide veterans with guidance by creating industry growth projections for veterans who will enter the job market in the next decade. According to the RAND Corporation, industries with projected high growth include education and health services (projected to grow 12.9% by 2031) or entertainment and hospitality (projected growth of 13.6%). If veterans enter industries with more projected overall growth, their jobs may be more insulated from future recessions.
Other opportunities for research include counseling veterans on the historical patterns of industries in particular geographic regions. Choosing where to live is also important because unemployment compensation Depends on where you live, not where you last served.
As previous recessions have shown, it is impossible to predict the future. But providing guidance and information to newly separated veterans can help them find more job opportunities to prepare for an uncertain economic future.