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'Not knowing how long this will continue is daunting': How the coronavirus is impacting Gen Z

Twenty/20

In many ways, Carter's experience during the coronavirus pandemic has been similar to millions of other young people across the U.S. He's been living at his parents' house in Connecticut for six months, celebrating his graduation virtually and helping his dad with odd jobs.

And as one of the oldest members of Gen Z— composed of those born between 1997 and 2012, according to Pew Research Center — the 23-year-old, who declined to share his last name because of his job search, is facing a tremendous uphill battle trying to land an entry-level job in the middle of a pandemic that has led to record unemployment in the U.S.

Carter began looking for a career in hotel management at the beginning of this year, even before he graduated from an MBA program in May. But when Covid-19 essentially shut down the hospitality industry in the U.S. in March, he had to wait months for job openings to reappear. Though he has been itching to get to work, it soon became apparent, he says, that landing a job would take longer than he anticipated.

With recent graduates competing with millions of unemployed workers for limited job openings, the number of people looking for work was higher than he expected, Carter tells CNBC Make It. "It soon became a common theme that these entry-level jobs, which are typically designed for recent grads, were being filled by people with years of experience."

One rejection email he received noted that over 140 applicants had applied for the single entry-level position, and the company was only proceeding with applicants with at least five years of experience.

Not knowing how long this will continue for is a daunting thought hanging over me.
Carter

"Not knowing how long this will continue for is a daunting thought hanging over me," he says.

The coronavirus pandemic has created unique challenges for every generation, pushing Baby Boomers out of the labor force and forcing millennials to reckon with their second "once-in-a-lifetime" recession.

The impact of coronavirus on Gen Z's finances and careers is mixed: Younger members are scrambling to acclimate to online learning and missing out on major life events like graduation ceremonies and prom. But it's the oldest members of this generation, those who turn 22 and 23 this year, who might fare the worst economically.

From record low unemployment to record high

Just eight months ago, these early 20-somethings were poised to enter the workforce during one of the longest economic expansions in U.S. history with record-low unemployment.

Once the coronavirus pandemic hit, though, these fledgling workers' fortunes took a turn for the worst. Entry-level job offers were rescinded and internships were cancelled en masse. Gen Zers were the most likely of any generation to be laid off during the coronavirus shutdowns, as those aged 18 to 24 make up a disproportionately high share of workers in vulnerable industries like the service sector, according to the Pew Research Center.

Gen Z is also the most diverse generation in the U.S., points out Ruth Igielnik, senior researcher at Pew. Ethnic minorities were hit harder than White workers by Covid-19 layoffs, compounding job losses. The unemployment rate for those aged 16 to 24 rocketed to 27% in April, before falling to 18.5% in July, which is about twice as high as July 2019.

Naomi Parker, 23, was furloughed from her first full-time job in March.
Naomi Parker

Naomi Parker can relate. After just one month of work, the 23-year-old was furloughed in March from her job working with kids with autism. She spent a few months living at her mothers' home in Baltimore, using her unemployment checks to pay down her student loan debt and waiting to be called back to work.

Eventually, she realized she was never going back to her old job and began applying to anything she could find. Though she applied for 30 jobs, for months she couldn't get past the first round of interviews.

"A lot of jobs didn't get back to me, and it was, kind of, shouting into the abyss and nothing is coming back," Parker tells CNBC Make It. "I started getting stressed out."

Most of Gen Z may be spared the worst outcomes

The negative effects of early career events like recessions can cause reverberations for decades. The Great Recession hindered  the earnings potential of the oldest millennials for life, and researchers are already warning that the U.S. may see another "lost decade" if the economy doesn't improve.

But while all that data paints a depressing picture, Igielnik tells CNBC Make It it's still too early in the coronavirus recession to say definitively if Gen Z will fare as badly as the generation preceding it.

Most members of Gen Z are still relatively young. While the coronavirus recession has been swift and far reaching, it's possible the economy will recover before many of the 19, 20 and 21-year-olds enter the workforce, sparing them the worst career and financial outcomes. But if it is prolonged, more and more of Gen Z will face setbacks.

It's only been six months, and it's so hard to know what the recovery will look like. But they are pretty hard hit even six months on.
Ruth Igielnik
Pew Research Center

"It just depends on how this recovery shapes up," says Igielnik. "It's only been six months, and it's so hard to know what the recovery will look like. But [Gen Z is] pretty hard hit even six months on."

Things have already improved for Parker. After a friend referred her for a marketing role that wasn't publicly listed, she switched careers and her salary increased from $27,000 to over $40,000. She recently moved out of her mother's house and is focusing on saving and paying off the rest of her $23,000 student loan balance.

Still, the months of being furloughed will stick with her. Though she's always been frugal, she plans to save at least 60% of her take-home pay, just in case.

"I'm still afraid of being laid off randomly," she says. "I'm just thinking about the next five years, and it's very, very hard to visualize it right now, because of everything that's happened."

Check out: The coronavirus pandemic is a 'defining moment' for Gen Z — here's how it's impacting their future

Don't miss: We analyzed 111 rewards cards, and the best one could earn you $2,000 over 5 years

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