What to Do If You Can’t Find a Job After Graduation

unemployed college graduates

In 2001, I graduated with a Bachelor’s degree in English and French Literature — and no job lined up after I walked across the stage. It took me several months to find a low-paying job in a bookstore. Not exactly the career I was hoping to start, but it allowed me to pay my bills, including my student loans.

Five years later, with a fresh new Master’s of Education degree in my hand, I again found myself with no job prospects post-graduation and student loan payments looming at the end of my grace period. I was lucky enough to land a teaching job a few months later (and a mere two weeks before the beginning of the school year), but it was a stressful time.

Even though both my graduations were more than a decade ago, many current college students still struggle to learn how to find a job after graduation.

It’s important for grads to remember that unemployment won’t last forever and there are things they can do to improve their situation, even if they owe student loans. Here’s what college graduates can do if they can’t find a job after graduation:

Reduce your expenses

Money is obviously the biggest stressor of unemployed college graduates, and there are two ways of dealing with it: reduce expenses or increase income. There are several tried-and-true methods for making your expenses lower while you are working on ways to increase your income.

1. Live at home

For recent grads, moving back into their childhood bedrooms can feel awkward (or even depressing), but it’s a savvy financial move. Mom and Dad may let you live rent-free or only charge you a minimal rent, and you will be able to save on food, utility, and other costs by living at home.

The important thing to remember is that moving home after graduation is just a place to start. It’s better to be there by choice while you are working to launch your career than to find yourself forced to move back home if you run out of money.

2. Create a budget

It is much easier to stretch your money if you know what your priorities are and where your money is going — which is why it’s so important to create a budget for yourself.

Start with an accounting of how much money you have (including any income you might be bringing in) and whatever recurring expenses you have. From there, you can determine what costs you can cut in order to live within the means you have.

Creating a fairly strict budget while you are unemployed is a necessity, but it can also be a blessing. Many people get used to the stricter unemployment budget and can continue to live on it once they land their first job.

That can give you the opportunity to put your savings (or debt-payoff) in overdrive because you are used to living on less.

3. Put student loans on hold

College grads generally enjoy a grace period for student loans after graduation, which is often enough time to find a job and get financially settled. Depending on which type of loan you have, you are eligible for differing grace periods for student loans after graduation.

Grace periods

  • Stafford Loans offer a grace period of six months for borrowers.
  • Perkins Loans have a standard grace period of nine months.
  • PLUS Loans do not have grace periods for borrowers. The first payment is generally due within sixty days after the final loan disbursement for the period of enrollment for which the loan was borrowed.
  • Private loans may or may not offer a grace period, although many do. These loans often refer to the grace period as an “interim period.”

Deferment

It can be particularly stressful to deal with student loans and unemployment. If you are coming close to the end of your grace period (or your federal loan does not offer one) and you still have not found a job, you may qualify for a deferment.

When you defer your student loans, you postpone your monthly payments during your unemployment for a period up to three years. If your loans are subsidized, then you will not accrue interest on your loans during deferment.

If you have unsubsidized loans, the interest will accrue during the deferment period. If you’re able, it’s advisable to pay the interest during your deferment period in order to avoid having it capitalized and added to your principal — but you are not required to do so.

You will have to apply for deferment through your student loan servicer. The process is never automatic. You may also be required to submit documentation to support your request.

Forbearance

Forbearance is an option available to borrowers who are not eligible for deferment. College grads will be looking at forbearance if they are “underemployed,” meaning they have some sort of job or temporary position, but it does not pay well enough or steadily enough to make loan payments.

By going on forbearance, you pause student loan payments for up to 12 months. However, interest will accrue on your loans, whether they are subsidized or unsubsidized. That accrued interest will be capitalized, unless you pay the interest during the forbearance period.

Just like deferment, you must apply for forbearance through your loan servicer, and you may be required to submit supporting documentation.

Increase your income

The other half of surviving the financial stress of unemployment is finding a way to increase your income, even if you have not yet landed a permanent job. Here are several ideas for unemployed college graduates to keep some money coming in while finding a job after graduation:

1. Broaden your horizons

An easy trap to fall into is keeping your job search narrow. You might assume that you need a job that fits your degree or location preferences, but that job might not exist.

Being open to opportunities can lead to big things, since you never know who you’ll meet or what you’ll learn in the job that doesn’t exactly fit your expectations.

2. Try temping

Temp agencies offer workers short assignments in a variety of different industries. Not only does temping help you pay your bills, but temp positions can sometimes lead to full-time jobs. It’s also a great opportunity to broaden your network and skill set through your temporary assignments.

3. Remember that part-time work is still work

You might pass up on an opportunity because it is only offering part-time hours (and pay). But working part-time in your industry can show future employers that you have a strong work ethic and you want to be self-sufficient, even if the job is less than ideal.

Attitude is important for unemployed college graduates

One of the hardest parts of dealing with student loans and unemployment is staying positive. Having a negative outlook can affect your job search, and feeling down about your job situation is something that potential employers can pick up on.

Remember that unemployment will be temporary — even if you can’t see the light at the end of the tunnel from where you are — and that you should continue living your life. Making time for hobbies, friends, or to learn something new will help you keep your job search in perspective.

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