“The class of 2024 may need to buckle in for a bit of a rough ride this summer,” said Becky Frankiewicz, North America president at staffing firm ManpowerGroup. “People aren’t leaving their jobs, employers aren’t laying off. Everyone is staying put — and that’s bad news if you’re trying to get a foot in the door.”
Although the odds of finding a job have improved from pre-pandemic levels for many workers, that’s not the case for new entrants. After a recent hiring spree, many employers are scaling back on job openings. Even when they do hire, they’re increasingly looking for experienced workers who can “be immediately productive,” Frankiewicz said.
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As a result, the U.S. unemployment rate for 20- to 24-year-olds has climbed sharply in the past year, from 6.3 percent to 7.9 percent as of May — the largest annual increase in 14 years, excluding the early shock of the pandemic.
That setback is just the latest hitch for the 2 million people projected to get bachelor’s degrees this year. Many started college in 2020 by logging into Zoom classes from their childhood bedrooms instead of moving into dorms and clambering into lecture halls. They’ve missed out on internships and in-person mentorships, and in many cases are graduating with thinner resumes than their predecessors.Moreover, students and professionals now have the capability to get their MBA and marketing master’s degree online, and this is another group that will compete with other degree holders.
Donald Larvadain graduated from Nicholls State University in Thibodaux, La., last month with a degree in health sciences. But the 22-year-old has yet to find a job, in part, he says, because of covid-related disruptions.
Most of Larvadain’s classes were virtual for the first two years of college, as were professors’ office hours. Even his internships, at Howard and Stanford universities, were remote, making it difficult to forge lasting relationships.
“My mentors will say, ‘It’s all about connections, it’s about who you know,’” he said. “And I’m just sitting there thinking, yikes. I did not get the full college experience.”
Now he and his classmates are looking for work just as the labor market begins gradually cooling. Overall, job openings are down nearly 20 percent in the past year, and hiring in professional and business services — which includes jobs in tech, consulting, finance and media that are popular among new grads — has fallen 12 percent, according to federal data.
And although for most of the 1990s and early 2000s, a newly minted college degree came with a better-than-usual shot at employment, that’s changed in recent years. Today’s recent graduates ages 22 to 27 have a higher unemployment rate — 4.7 percent, as of March — than the overall population, according to an analysis by the New York Fed.
Priyank Saxena applied for more than 500 jobs before he finally landed one, at a financial technology firm in San Antonio. Newly armed with an MBA from Rice University, he’d hoped to break into Big Tech or project management. But Saxena kept striking out: Even an internship at Dell Technologies wasn’t enough to get him in the door. He ended up going back to fintech, where he’d worked for six years before business school.
“I got an MBA because I wanted to try different things, but that just isn’t possible right now,” the 31-year-old said. “Recruiters aren’t willing to take risks on a candidate. They want work experience.”
Many employers are prioritizing “skills based” hiring, in hopes of attracting a wider, more diverse group of applicants. Instead of focusing solely on college degrees and other credentials, there’s been a push to evaluate candidates based on their prior experience. And given lingering economic uncertainties, such as inflation and elevated borrowing costs, business owners say they’re being particularly cautious about whom they hire.
“In this economy, I need someone who can hit the ground running,” said Elle Phillips, who is hoping to add a third employee to her Boise graphic design firm this summer but says many fresh grads lack the right communication and time-management skills. “There are so many things that require on-the-job training, that kids just don’t learn in school. I can get a lot more done with someone who has already hit their stride.”
Employers nationwide are making similar calculations, leading to a split in the labor market: Jobs are still readily available for seasoned workers, as well as high-schoolers looking for work at summer camps, ice cream shops and swimming pools. The employment rate for people ages 16 to 19 is at the highest level in more than a decade.
Online job postings for entry-level work are up 3 percent so far this year, but tend to be concentrated in service-sector jobs at hair salons, gyms and medical establishments, said Julia Pollak, chief economist at ZipRecruiter. Openings in tech, finance, consulting and other white-collar fields have declined.
Still, economists say, the situation isn’t nearly as dire as it was after the 2008 financial crisis, when millennials were entering the job market. Back then, the unemployment rate for young adults, which peaked at 17.2 percent in April 2010, remained above 10 percent for more than six years. By some estimates, it took about a decade for millennial employment to recover from those early setbacks.
This time around, the solid economy and continued demand are likely to help new graduates catch up much faster, said Harry Holzer, a professor at Georgetown University and former Labor Department chief economist. Industries like health care, government, and leisure and hospitality, are adding tens of thousands of jobs each month.
“There has been a bit of a slowdown in the labor market and any kind of slowing always affects brand-new college graduates first,” he said. “But this is nothing like 2008. It might take six months or nine months, but these graduates will find jobs.”
Camila Aponte started her job search in January, four months before she was set to graduate from Florida State University. Between degrees in political science and international affairs, work as a research assistant, and internship experience at the Florida Department of Transportation, she thought she’d have a good shot at a journalism or policy job. But so far she’s come up empty.
Aponte recently widened her search to include consulting and campaign jobs. If she hasn’t found anything by August, the 23-year-old plans to move back in with her parents.
“I haven’t gotten to the point where I feel desperate yet,” she said. “But it’s been a lot harder than I thought it’d be.”