The Grio — As the National Urban League unveiled its 12-point plan for dealing with joblessness in urban communities of color, the organization also highlighted one of the hardest-hit demographics among the unemployed — young, black adults.
While the root causes of unemployment many, unfortunately we sometimes shoot ourselves in the foot and hurt our own chances at landing that next solid job.
Here are four ways college graduates, and other job-seekers, ruin good job options:
1. Bad Credit
If you thought being late on your car note a few times or skipping your VISA payment was a matter between you and your creditors, think again. Bad credit can cost you a good job.
Whether or not we like it or agree with the practice, the fact is: most employers are now performing credit checks on job applicants, as part of the background check process. According to the Society for Human Resources Management’s 2010 Background Checking Survey, 60 percent of employers perform credit background checks.
In 9 out of 10 cases, don’t expect an employer to flat-out tell you that a company didn’t hire you because of your poor credit rating. But think about it logically: If you and another person had roughly the same skills, qualifications and experience and that other applicant had good credit versus your bad credit, which person do you think is most likely to be hired?
For better or worse, employers associate a good credit rating good character and trustworthiness. They think that a person who pays her bills on time and honors her obligations is more likely to also be a reliable employee, coming to work on time, finishing deadlines and projects on time, and generally being a better, more stable worker.
Is it reasonable for employers to conduct credit checks on job candidates who will have financial responsibilities – executives like CFOs or even bank tellers who’ll be handling customer funds all day? Yes. I think so. In such cases, companies want to be sure that bad credit and financial problems won’t lead you into temptation or stealing from the corporate coffers.
But why should credit reports be wisely used in the workplace?
I’ve yet to see a single study or report showing a link between good credit and high job performance, which is why I think using someone’s credit report as a basis for making hiring decisions is generally misguided and a wrongheaded business practice. But as a Money Coach, I can assure you that job rejections on the basis of credit happen all the time. In fact, black people (and others) have told me about having nailed interviews and being formally offered jobs – only to have those job offers rescinded after an unfavorable credit check surfaced.
2. Defaulted Student Loans
Having seriously delinquent student loans is another financial misstep that is taking Blacks out of the running for certain jobs.
For example, if you want a position with the U.S. government – one of the biggest entities hiring right now – butyou’ve defaulted on a federal student loan, your job application is essentially dead in the water. Not repaying student loans can even cost you a security clearance if you’re in the military.
Being locked out of government jobs and unable to enlist or get promoted within the armed forces is a position blacks can’t afford to be in, especially since African-Americans are over-represented in these areas. Though African-Americans comprise just 12 percent of the U.S. population, blacks make up 18 percent of federal workers17 percent of active duty service members in the military.
Unfortunately, student loan defaults are four times greater among college-educated blacks their white counterparts. Many historically black colleges and even various for-profit schools large black student populations top the list of academic institutions with the nation’s highest college loan default rates. While the national student loan default rate is around 8 percent, according to the U.S. Department of Education, at many Black colleges the default rate is 25 percent to 30 percent and higher. Such financial lapses impact these individuals’ career options.