Sad for Grads

Survey after survey tells the same story: Companies just aren’t hiring as many college graduates this year as in 2008. Rich Milgram, CEO of Beyond.com, an 11-year-old company that has built a network of 15,000 targeted and niche job boards through ownership and strategic relationships, even goes a step further.

“This is probably the toughest time I’ve ever seen, and it’s the toughest time these grads have ever seen,” he said.

Every year, the National Association of Colleges and Employers conducts several surveys to shed light on its employer members’ recruiting strategies. This year’s Job Outlook 2009 Spring Update survey, conducted in February and released in March, showed that employers expect to hire 22 percent fewer graduates than last year.

“That’s the only reduction since 2003,” says Andrea Koncz, NACE’s employment information manager. “And that was just a 3½ percent decrease.”

NACE’s quarterly salary survey, which focuses on offers by major employers, complements the job outlook survey. This spring’s survey released in April shows that the average salary offer in 2009 is $48,515, down by 2.2 percent from spring 2008’s average of $49,624. According to the survey, computer science salary offers are down by 5 percent, engineering salary offers are up by 2.3 percent, and both business and liberal arts majors’ offers are flat.

“Business graduates are the hardest-hit majors,” Koncz says. “Computer science majors usually get higher salaries, because they are usually pretty well in demand, but we are still seeing decreases.”

In January, career management and job search specialist Vault surveyed 150 corporate recruiters across a spectrum of industries and found that 77 percent had reduced hiring goals just since September. Fifty-two percent of respondents said salary offers would remain flat for baccalaureate graduates, and 51 percent said the same would be true for offers to newly minted MBAs.

“Recruiters are going to fewer campuses and doing more electronically because their budget for travel has been cut,” says Vault CEO Erik Sorenson. “Forty-three percent of respondents are slightly or dramatically reducing pay, although most said pay would be the same as in 2008 but with fewer hires.”

At the University of Houston, “Demand is down almost across the board,” says David Small, associate vice president for student services. “Salaries are flat, with marginal increases in some areas. We’ve seen companies cut back on recruitment resources. They’re making fewer campus visits and coming to career fairs instead.”

Small says companies are also making greater use of online job postings and résumé searches.

“Companies seem to be looking for more immediate needs, not the long term,” he says. “When they do hire, they are looking at their intern pool before new graduates.”

The story is the same at Ohio State University.

“My sense is that companies are being more conscientious about recruiting dollars, so they are conducting more phone interviews and coming to campus less often,” says Stephanie Ford, director of the university’s Arts and Sciences Career Center. “They’re operating on less information.”

Recruiters plan campus visits, but find out just before their trip that there’s no money to hire.

“So we are having employers schedule for employee information sessions and career fairs, but pulling out when they find there is no money,” Ford says.

She notes that the number of recruiters coming to campus is down from last year, but that companies are doing what they can, such as helping students with mock interviews or by speaking to student groups.

At Ohio State’s Fisher College of Business, interviews are down by 20 percent and job postings are down by 25 percent from 2008.

“It could be worse, but it isn’t,” says Jeff Rice, the executive director in the Office of Career Management at Fisher College. “That’s because in 2001 and 2002, companies took a year off from recruiting. When a company does that, it loses about three years in terms of its brand. Also, companies gain momentum in hiring from one year to next as the graduates talk to one another. So [this year], companies have reduced hiring, but they are keeping the pipeline going.”

One key to finding a job in the 2009 economy seems to be a graduate’s ability to produce immediate results.

“Employers are cutting back, only recruiting for people who can drive revenue or maintenance of current projects,” Milgram says.

So sales is a hot area, as are health care, technology and engineering. According to Milgram, good salespeople can improve a company’s overall balance sheet, so they are in demand. Although new technology projects and research are on hold for now, companies “still need to maintain systems and current projects.” Milgram says health care is stable in any economy, and engineers have specific skill sets that people with other majors can’t match.

Sorenson agrees that graduates who can immediately contribute to an organization have the best opportunities, like teaching.

“It’s not enough just to have a college degree in education,” he says.

Certified public accountants willing to work in industry are more likely to find jobs than those seeking positions in banking. According to Sorenson, jobs with high skill sets are hot now, including health care, IT, engineering, teaching and accounting—similar to Milgram’s list.

Rice has identified yet a third set of opportunities for new graduates.

“Follow the stimulus money for the jobs,” he says. “It’s encouraging how focused this generation is on the economy. They’re following where the stimulus money is going because that’s where the jobs will be—in government, energy, health care, education and technology.”

Rice sees stimulus opportunities for majors in accounting, engineering, technology, finance, operations management, and marketing and sales.

For liberal arts graduates, who always face tough job markets, the University of Houston’s Small has some rare good news. “The State Department said that 50 percent of its new hires will be liberal arts majors,” he says. And although finance is not hot this year, Small says financial planners who can work with small companies have opportunities.

“Even companies that are growing are being more cautious so they don’t end up on a downward spiral,” Milgram says. “Companies doing well are waiting it out. They’re not firing, but they’re not hiring, either. Companies doing poorly are firing. College students face increased quantity and quality of competition. That’s not good news for graduates.”