Graduate Job Prospects Slightly Better Than Year Ago
CHICAGO, April 18, 2012 – As the economy continues to slowly improve, so do the prospects for entry-level job candidates who are expected to benefit from companies’ need to rebuild “bench strength” after cutting millions of workers during the recession. However, while this year’s crop of 1.7 million college graduates should fare slightly better than last year’s, the job market will remain fiercely competitive, according to a new outlook from global outplacement consultancy Challenger, Gray & Christmas, Inc.
The college graduates who are likely to have the most success are those with the flexibility to go wherever the jobs are and those seeking positions in the occupations expected to see the most growth over the next decade. Among the top fields are accounting and finance, engineering, computer science, sales and marketing, education, and health care and social services.
“Job creation has been stronger in some months than others, but the general trend has been upward. The private sector has seen positive employment gains for 25 consecutive months. The job market still has a long way to go before full recovery, but the good news is that young job seekers with four-year degrees are in growing demand,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
Indeed, job gains have come in fits and starts. Last year, hiring was strong through early spring, only to drop off in the summer and fall. The private sector averaged 248,000 new payroll jobs from last December through February 2012, but then dropped to just 121,000 new jobs in March, according to the latest data from the Bureau of Labor Statistics (BLS). While the pace of hiring has been volatile throughout the recovery, every month since February 2010 has experienced positive job growth for a total of 4,051,000 new jobs.
Further analysis of BLS data reveals that 20- to 24-year-olds were among the biggest benefactors during the 25 months of consecutive job gains. While the BLS data does not break out employment by age and education level, the 20 to 24 age group is most likely to contain recent graduates. According to the data, the number of employed 20- to 24-year-olds increased by 939,000 from March 2010 through March 2012. The only group to experience larger employment gains was at the opposite end of the age spectrum; the number of workers 55 and older increased by 2,851,000 during the same period.
Net Employment Change, March 2010 – March 2012
|20 – 24||
|25 – 34||
|35 – 44||
|45 – 54||
Source: U.S. Bureau of Labor Statistics
“Companies want experienced people who can hit the ground running with little to no training, hence the impressive gains among older job seekers. However, employers are also thinking about the future the need to replace an aging workforce that will not continue to work forever,” said Challenger.
“Each year, we continue to see improvement in the college graduate job market. Last year, was slightly better than 2010 and this year should be slightly better than 2011. Unfortunately, those expecting a rapid turnaround and sudden burst in hiring will be disappointed,” he added.
In fact, two surveys show that while college graduate hiring is expected to be better than last year, the rate of improvement has slowed. A recent survey by the National Association of Colleges and Employers (www.naceweb.org) found that employers plan to increase hiring of spring graduates by 10 percent over last year. That is down from last year, when the same survey found employers were expecting to increase college graduate hiring by 21 percent compared to the class of 2010.
Similarly, a survey of 4,600 employers, the Collegiate Employment Research Institute at Michigan State University (www.ceri.msu.edu) found that hiring of 2011-2012 graduates earning bachelor’s degrees will increase about 7 percent from last year. That is down from a 10-percent increase in hiring reported for the class of 2010-2011.
“While the job market for graduates is slightly better than a year ago, entry-level hiring is nowhere near pre-recession levels. Most graduates will find the job search fiercely competitive, as they vie for positions against their fellow classmates but also against graduates from the previous two years. Many of the graduates from 2010 and 2011 are still seeking employment in their field of choice after settling for less desirable positions simply to earn a living,” said Challenger.
“One advantage recent graduates may have over their older competitors is that they significantly more flexible in terms of where they work and when they work. They are not tied down by an underwater mortgage or a family, so they can go wherever a company needs them to go. And, because many don’t have the family commitments that many 30-something and older workers do, they are more willing to work longer and/or non-traditional hours,” he noted.
“Even other young job seekers who graduated within the last few years are less flexible when it comes to going where the jobs are. They are less likely to have mortgages and families, but if they have been in one place for a year or more, they probably have established friendships and other ties, including professional relationships, which make it more difficult to relocate,” Challenger added.
Recent graduates may not have to move far to find the best job markets, as several of the metropolitan areas enjoying the lowest unemployment rates in the country also home to major colleges and universities. The unemployment rate in Ames, Iowa, where more than 28,000 students attend Iowa State University, was 4.0 percent in February. The unemployment rate is also 4.0 percent in Lincoln, Nebraska, where the main campus of the University of Nebraska is found. Students graduating this spring from the University of Iowa in Iowa City can enter a local job market with an unemployment rate of 4.2 percent.
“As of February, there were 41 metropolitan areas with unemployment rates under six percent. There were another 49 with a jobless rate between 6.0 percent and 7.0 percent, still well below the national average of 8.7 percent. These are definitely places, soon-to-be graduates should be considering when casting their job-search nets.
“While the New York City borough of Manhattan is more glamorous than Manhattan, Kansas, the hometown of the Kansas State University currently has an unemployment rate of 5.8 percent. That is considerably lower than the 10.2 percent unemployment rate found in New York City,” said Challenger.
“Regardless of where one searches for employment, the competitive nature of the job market requires an aggressive approach to the job search. Soon-to-be graduates cannot expect to hand out a few resumes at job fairs and reply to some online postings and simply wait for a phone call or email. Make no mistake, job fairs and online job boards have their place in the job search, but to be successful a well-rounded strategy is required.
“One of the most important elements of a successful job search, for both entry-level job seekers and their more-experienced counterparts, is networking and meeting face-to-face with people who can help advance the job search. College graduates who believe they are too young to have an effective network are simply wrong. Parents, professors, former internship supervisors and even college and former high school classmates can be valuable sources when it comes to building and expanding one’s network,” said Challenger.
“Finally, graduates should not confine their searches to a specific industry or occupation. The job market is not robust enough to provide the ideal job situation for every individual. It seldom is. So, someone may come out of college with the plan to find a marketing position with a consumer products company. There’s nothing wrong with having a specific goal like that, but don’t make the mistake of adhering to it so closely that you overlook opportunities in marketing for a chemical company or health care provider, for example,” he said.
The graduates who may enjoy the most success are those seeking employment in occupations expected to experience the largest job growth over the next decade. According to projections by the Bureau of Labor Statistics, job categories where demand for workers with four-year degrees will continue to be strong through 2020 include accounting, engineering, information technology, financial services, sales and marketing, and human resources, to name just a few.
“Again, the key is to avoid setting to many limitations on your search. Just because you studied accounting does not mean you have to work for an accounting firm. Home health agencies and hospitals are adding hundreds of thousands of workers over the next decade, some of whom will be accountants. These health care organizations also need information technology workers, marketing specialists, industry analysts, risk managers, grant writers, etc. Do not hesitate to look outside of your comfort zone,” Challenger advised.
OCCUPATIONS REQUIRING 4-YEAR DEGREE AND
ADDING 50,000+ NEW JOBS BETWEEN 2010 AND 2020
|Occupation||Projected Growth Rate||2010 Median Pay|
|Accountants and Auditors||10 to 19 percent||$55,000 to $74,999|
|Child, Family, and Social Workers||20 to 28 percent||$35,000 to $54,999|
|Civil Engineers||10 to 19 percent||$75,000 or more|
|Computer and Information Systems Managers||10 to 19 percent||$75,000 or more|
|Computer Systems Analysts||20 to 28 percent||$75,000 or more|
|Cost Estimators||29 percent or faster||$55,000 to $74,999|
|Elementary School Teachers||10 to 19 percent||$35,000 to $54,999|
|Financial Analysts||20 to 28 percent||$55,000 to $74,999|
|Human Resources, Training and Labor Specialists||20 to 28 percent||$35,000 to $54,999|
|Information Security Analysts, Web Developers and Computer Network Architects||20 to 28 percent||$75,000 or more|
|Management Analysts||20 to 28 percent||$75,000 or more|
|Market Research Analysts and Marketing Specialists||29 percent or faster||$55,000 to $74,999|
|Sales Representatives, Wholesale and Manufacturing, Technical and Scientific Products||10 to 19 percent||$55,000 to $74,999|
Source: U.S. Bureau of Labor Statistics