A new survey from Michigan State University has some great news for college and graduate students who will be finishing school in 2016: Hiring is expected to jump 15% next year. The survey, called Recruiting Trends, is the oldest, most comprehensive of its kind. Now in its 45th year, it polled 23,000 employers nationwide and got responses from more than 4,700 of them.
The employment drivers this year: company growth and employee turnover, with an increasing number of Baby Boomers retiring from the labor force.
This is the second year in a row that the survey has shown double digit hiring growth. Last year, hiring climbed by 16% over the previous year. That was a significant jump from the 7% increase in 2014.
“Most signs point to another explosive year of growth in the job market for college graduates,” says Philip Gardner, director of Michigan State’s College Employment Research Institute (CERI), which conducted the study. Gardner is also executive director of career services for Michigan State.
Gardner underlines how much things have changed since the battered, post-recession employment market. “’Recruit like it’s 1999’ accurately describes the explosive growth in the college labor market for the past two years,’” says Gardner.
While employers project hiring increases, they don’t plan to bump up salaries by much. Gardner projects that starting salaries across the board will rise modestly, by 2% to 5%, though some professions, like engineering and information technology, will offer bigger increases. Example: an electrical engineer with a bachelor’s degree can expect to start at $61,000, according to the survey, a 7% increase from the previous year. At least starting salaries are up more than inflation, which is at a very low 0.2%.
Gardner says his data suggest that college hiring will remain strong, whether or not the economy steadies. “Even if the economic headwinds strengthen, the college job market should withstand a bump in the road,” he says.
Which industries will hire the most grads? Gardner crunched numbers from the surveys and came up with eight categories. He collects the surveys by reaching out to career offices at 200 schools around the country, including Northwestern, MIT and a range of state universities. They send his survey to employers who recruit on their campuses, offering a broad cross section.
The sector where Gardner projects the greatest hiring growth is the broadest category, which is good news for grads. Gardner calls it Professional, Business & Scientific Services and he predicts a robust 38% bump in college hiring there. The category includes accounting and consulting firms, engineering services companies that design prototypes for other companies, firms that provide computer design services, software development companies, civil engineering and science providers like companies that prepare environmental impact statements and test water and air quality. Law firms, a weak player in the sector, push this category’s numbers down. In 2014, 59.9% of law graduates found work that required bar passage, according to the American Bar Association. That’s up only slightly from 57% in 2013, and it’s likely because fewer people are going to law school. The law class of 2014 shrunk 6.5% to 43,832 from 2013. Hiring among accounting firm is especially strong, says Gardner, projected to climb by 63% in 2016. “Some very large firms are making significant investments in talent,” he says. I checked in with accounting and professional services firm EY, which reports that it plans on increasing U.S. campus hiring by double digits, but its projections don’t approach 63%. It plans on making 5,700 full-time campus hires, up 12% from 2015.
The second-strongest category is Finance & Insurance, with a projected 28% hiring bump. While Gardner says he sees no recovery in the banking sector, the surveys point to strong hiring among insurance companies like Prudential and Geico, and securities firms like retirement fund provider TIAA-CREF. Aside from the big players, many of the firms in this category are small, so that when they increase their staff from 12 to 19 people, they show a 58% increase. Washington, DC-based car insurer Geico plans to hire 750 new grads in 2016, a 50% increase over 2015.
Two sectors tie for third place, Information Services, which includes internet service providers, data processors, wireless carriers and satellite companies. That sector will increase college and university hiring by 24%. Gardner says telecommunications is up just 6%. Broadcasting is in this category, as is my profession, journalism. Those professions, not surprisingly, are shrinking, says Gardner.
The other sector Gardner says will increase hiring by 24% is Health Care & Social Assistance, which includes hospitals, where Gardner says hiring is robust. Meantime social assistance hiring is down. That includes child protective services, services for people with disabilities and home health aides, which together are planning to hire 15% fewer grads than last year.
The weakest sector is manufacturing, where hiring is projected to shrink by six percent. Biggest hit: anything that involves oil, like plastics, including companies like Rubbermaid. Companies like
For hiring projections in all eight sectors in Gardner’s study, see our slideshow above.
