Economic news of late has not been good. Commodities such as gasoline and wheat are more expensive than they have ever been, precious metals (and other precious things that investors buy when they have little confidence in less tangible securities) are at an all time high. The value of U.S. currency is the worst it’s been in my lifetime, and continues to grow weaker by the day. Meanwhile, the financial markets are slowly melting down, and are being bolstered by cheap and inflated credit, mortgage banks, investment banks, and banks in general are going bust in the U.S. and around the world. What does this mean to us as designers?In Naomi Klein’s newest book, The Shock Doctrine;, she explores the rise of “disaster capitalism” and the use of it to manipulate government and public policy. All of these changes have a very direct affect on the marketplace for designers and for design services.
Many of my students are coming to my office hours in a slight (but tenable) panic: graduation is coming up in a few weeks, and the job market is the worst it’s been in their lifetime. What to do? First off, don’t panic! The news is grim, but it’s not the end of the world. You’ve worked hard for your education, and your academic experience will continue to gain value every single day. However, the money in your wallet likely won’t grow in kind, so it’s probably a good idea to rethink financially-related things a little bit.
Here’s the down side:
1. The value of the dollar is going to continue to plummet. It’s always the lowest right before the U.S. elects a new president. The lower the dollar falls, the more expensive things in this country will become. That effect will last for about 6-12 months after the dollar begins to rise in value.
2. International travel is very expensive, as the weaker dollar buys less abroad. Consider checking out the West coast for spring break, rather than Europe.
3. Inflation is about to really kick in. Most students have never experienced a period of inflation (rising prices and falling value of dollar) to any significant degree. Inflation essentially means you’re making the same amount but your dollar buys less and less. Inflation will likely get worse at the dollar continues to lose value, and the Fed tries (harder and faster) to bail out weakening financial markets. Make purchases wisely, and hold off on any major purchases that might burden your budget (especially things like moving, or major down payments — like on a new apartment.)4. Start thinking about little areas to save a little bit of money (do I really need a $30 text messaging plan? Can I brown bag my lunch rather than hit up the SAU every day?
Here’s the bright side:
1. No one is really immune from a financial downturn. So don’t panic.
2. Every time the Fed lowers the interest rate, it means the interest rate on your credit cards and student loans is going down too.
3. NOW is a good time to start working with a design management agency (Aquent is a reputable one). They specialize in “temp” work and placements, but these not-so-hot jobs can help you to gain experience and get a foot in the door, while helping you to pay the bills in the meanwhile.
4. As stocks and other securities fall in price, it’s a great time to buy (they will, eventually, rebound). As difficult as it may be to think about when you barely have money to eat, snapping up investments now can pay off in a major way down the road. Even a hundred dollars could potentially become a few thousand in only a few short years. 4. Consider working abroad. If you can work in a country that has a strong currency and economy you can actually beat inflation and make extra money!
Most of all, hang in there. Economic downturns are a fact of life. The trick is not to panic, and not to worry. Before you know it, it will be over… probably. 🙂