Most observers agree that job seekers from the Class of 2016 are facing better conditions than their peers from the past few years. Sustained labor market growth and a steadily expanding economy are chief among the reasons for this optimism, but the good news nonetheless comes with caveats, as detailed in a number of recent reports.
According to one survey by human capital consulting group CareerBuilder, job market conditions for college graduates are currently the best they have been for nearly 10 years. Two-thirds (67 percent) of employers surveyed by CareerBuilder said they plan to hire recent college graduates this year, up from 65 percent in 2015, and the highest percentage since 2007.
In that same CareerBuilder report, however, many employers expressed skepticism about college graduates’ readiness to enter the workforce. Nearly one out of four (24 percent) respondents said academic institutions are not adequately preparing students for the roles available within their organizations. Of that group, nearly half (47 percent) said there was “too much emphasis on book learning instead of real-world learning,” and another 39 percent said they needed workers “with a blend of technical skills and those skills gained from liberal arts.”
Graduates are also looking for a few things from their prospective employers, said Tom Borgerding, president and CEO of Campus Media Group, a Bloomington, Minn.-based marketing and advertising firm that helps employers develop their brands and recruiting strategies for college campuses.
“Flexibility is one of the biggest things right now, and the opportunity to grow,” he said. “Graduates today aren’t really looking to climb a corporate ladder, but they want to create a corporate web for themselves—that means the opportunity to learn and experience different things on the job. Rather than say, ‘This is your path,’ employers should promote the idea of ‘What do you want your path to be?’ ”
Wherever they decide to settle for work, many college graduates will also be carrying student loan debt. That’s why some employers are now offering assistance with that financial hardship, said Stephen Dash, CEO of Credible, a San Francisco-based multilender student loan marketplace. The company’s website offers options for student loan refinancing, and Credible has partnerships with about 100 alumni associations and professional associations, Dash said.
“It can be viewed as similar to a 401(k),” he said. “The employer makes contributions toward that debt for the employee. It’s a benefit platform that has really emerged over the last six to 12 months.”
Student debt is the second-largest type of consumer debt in the United States behind mortgages. While assistance with student loans can be a highly attractive benefit, related offerings can provide plenty of value for young job seekers, he said.
“Students coming out of school want the resources to make better financial decisions all around,” Dash said. “Employer benefits don’t necessarily have to be monetary. It’s very often about educating people.”
Here are a few other projections on job prospects for the Class of 2016:
*According to The Class of 2016, a report from Washington, D.C.-based think tank Economic Policy Institute (EPI), the unemployment rate is 5.6 percent for young college graduates, but that rate jumps to 9.4 percent for young black college graduates. Real wages, meanwhile, have increased in 2016 for young high school and college graduates, who saw wage growth of 3.3 percent and 3.1 percent, respectively. But EPI’s research also found that female high school and college graduates still earn less than their male counterparts.
*A survey by the Bethlehem, Pa.-based National Association of Colleges and Employers (NACE) showed that employers expect to hire 5.2 percent more new graduates from the Class of 2016 than they hired from the Class of 2015, but that’s down from an initial projection of 11 percent forecasted in the fall of 2015. NACE, which conducts research on college-educated workers, also found that the average number of job postings for the 2015-16 recruiting year is “down significantly” from 2014-15, while the average number of applications per posting has remained consistent.
*San Francisco-based SmartRecruiters, a recruiting software systems company, recently reviewed internal data from 700 employers and 1 million job listings. The research found that sales positions (14 percent) presented the most entry-level opportunities for 2016 college graduates, followed by customer service jobs (12 percent). Among industries, technology (21 percent) is conducting the most hiring for entry-level jobs, followed by health care (11 percent) and communications (9 percent), according to the report.
*Recent graduates who have the means to relocate as part of their job search are advised to head to Washington, D.C., San Francisco or Boston, among other areas of the country, according to the Great Barrington, Mass.-based American Institute for Economic Research (AIER). The nonprofit research group’s Employment Destinations Index ranks employment destinations for college graduates based on quality of life, work opportunities and the presence of other young people. The Washington, D.C., region topped AIER’s list for major metro areas (those with more than 2.5 million residents), and San Jose ranked first for midsize metros (those with 1 million to 2.5 million residents). The top-rated small metro region (between 250,000 and 1 million residents) was Ann Arbor, Mich., and the highest-ranked “smallest metro” (fewer than 250,000 residents) was Iowa City, Iowa.
Joseph Coombs is a senior analyst for workforce trends at SHRM.
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Joe Coombs is Senior Analyst, Workforce Trends and Forecasting for the Society for Human Resource Management (SHRM). Joe tracks current trends and issues in the labor market including the economy's impact on hiring and recruiting, wages and compensation, retirement benefits and the aging of the work force. In addition to The Jobs Blog, he also writes monthly and bi-annual reports on the labor market using data culled by the research department. Contact him at Joseph.Coombs@shrm.org or on LinkedIn.
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