The job market for new college graduates will continue to improve slowly in 2013-14, as cuts in the banking and credit industries, as well as political uncertainty, hold back what could otherwise be robust growth, according to a new report from the Collegiate Employment Research Institute at Michigan State University.
Job opportunities will increase by 2 percent across all degree levels, similar to last year’s growth, says the latest annual “Recruiting Trends” report. Its findings are based on a survey of more than 6,000 employers.
Uncertainty over the federal budget and debt ceiling have many employers taking a “wait and see” approach, says the report. Only a quarter of respondents said they had definite hiring targets for 2013-14.
The job market for new graduates could have posted double-digit growth were it not for the financial-services sector, which has been shedding jobs, said Phil D. Gardner, principal author of the report and director of the research institute.
“That does affect college students because that’s a place where a lot of new college graduates start,” he said of the banking and mortgage industries, both of which are downsizing.
Hiring by Degree
Still, the effect of financial-services cutbacks was worse for new graduates at higher degree levels. The report predicts a 24-percent decrease in hiring for M.B.A.'s, even as enrollment in full-time M.B.A. programs is on the rise.
Hiring for master’s-degree recipients in other fields, already weak, is expected to contract by 4 percent, driven mostly by a lack of job opportunities in government.
Some employers, the report notes, are hiring bachelor’s-degree holders for jobs that used to require an M.B.A. At the bachelor’s-degree level, new graduates are projected to see a 7-percent increase in opportunities this year.
While a third of employers said they would train any candidate, regardless of major, the most-sought-after bachelor’s-degree holders were still those in business and technical fields. Accounting, marketing, and finance majors were at the top of the list, while computer-science and computer-programming graduates were also heavily recruited.
For Ph.D. graduates, the report says, opportunities outside of academe are expanding. Hiring for doctoral-degree holders is expected to increase by 26 percent this year. While the 300 employers who reported that they were hiring Ph.D.'s make up a small sample, Mr. Gardner noted, it is considerably larger than in the past.
“Eight years ago, I wouldn’t have even gotten 100 people admitting that they were hiring Ph.D.'s,” he said. Doctoral-degree holders are often courted by engineering and health-science start-up companies, he said, as well as companies looking for talent in big-data management.
Starting Salaries
One-third of employers said they would increase starting salaries this year. The average starting salary for a bachelor’s-degree recipient is expected to be $39,775 in 2013-14. “For the first time since 2008,” the report says, “we are finally seeing the recession’s grip on starting salaries ease.”
Starting pay for associate-degree holders ranged from $34,878 for those in health-services fields to $46,992 for computer-science majors. M.B.A.'s, meanwhile, started out making $59,491, on average, while those with a master’s in social sciences had an average starting salary of $42,874. Engineering and computer science Ph.D.'s had the highest average starting salaries, at $78,860.
While many companies have recruited mainly in the fall in recent years, more have indicated that they will renew those efforts in the spring, Mr. Gardner said. That’s a good sign, he said, but students still shouldn’t wait too long if they want to line up a job, as most employers probably will have met their recruiting goals by mid-March.
Internships are an important element of many employers’ recruitment, according to the report. Sixty percent of all companies that offer internships said those positions were primarily to identify and develop talent.
Employers are searching for candidates who can prove that their education will translate into real-world skills, said Mr. Gardner. Many company representatives, he said, commented that students were not prepared to enter the work force.
“This economy is not going to be one that embraces entitlement,” Mr. Gardner said. “It’s about, What can you do? And how fast can you learn how to do everything else?”
