Expanding workforce greets new grads

THE NEARLY 1,400,000 college students graduating this spring will find the strongest entry-level job market in over three years, as employers attempt to rebuild bench strength following a period of record downsizing that slashed more than 4,000,000 workers from payrolls. Graduates across a broad range of fields will enjoy the benefits of a job market recovery that has added 2,200,000 positions over the last 12 months. Business grads are likely to fare the best, particularly those specializing in operations management, accounting, marketing, and economics/finance, according to the annual "Spring Graduate Job Market Outlook" released by the global outplacement firm of Challenger, Gray & Christmas, Inc., Chicago.

Other areas expected to be fruitful include education, health care, engineering, information technology, and computer science.

Moreover, the confidence of entry-level job seekers should be bolstered by the latest Job Market Index, which indicates a sharp decline in the length of time it takes jobless managers and executives to find new positions. The survey shows the median job search time falling from four months to 3.3.

"Graduates should also be emboldened by the fact that the unemployment rate among those holding a bachelor's degree and higher fell to 2.4% in January, which is the lowest this figure has been since August, 2001," says John A. Challenger, chief executive officer of Challenger, Gray & Christmas, citing data from the Bureau of Labor Statistics.

Several other surveys point to an improving market for graduates. The National Association of Colleges and Employers found that employers plan to increase the number of new college graduates hired in the 2004-05 academic year by 13.1%. In a follow-up survey, 62.5% of employers stayed with their original projection while 25% said they anticipated hiring more than they originally thought. Meanwhile, among the top 500 entry-level employers in 2005, ranked by the online job search site CollegeGrad.com, hiring is up 14.2% over 2004.

Vying for the increased number of positions are the 1,352,000 college students expected to obtain bachelor's degrees in the 2004-05 academic year, reports the Department of Education's National Center for Education Statistics. Meanwhile, another 578,000 should be obtaining master's degrees.

If history is any indication, the largest number of bachelor's and a significant number of master's will be awarded in the area of business. In 2002, the last year for which the Department of Education has data, 281,330, or 22%, of the 1,291,900 graduates received degrees in business. Among the 482,118 graduates receiving master's degrees in 2002, 120,785, or 25%, studied business. That was second only to education, which saw 136,579 graduates receive master's degrees.

"It is not critical that young people exiting college immediately enter the career track they studied over the last four years. What is vital is getting into the workplace to start gaining general on-the-job experience," Challenger urges. "Future employers want to know that you are able to meet deadlines, [function] within a team, and understand how business works."

Those graduating with business degrees likely will find themselves in high demand among employers. Some of the fastest growing job categories are in business administration, finance, operations management, and accounting. The number of accounting jobs is expected to grow by 15.1%, or 381,000 jobs, by 2012, project estimates from the Bureau of Labor Statistics.

Part of the demand is the result of new regulations under the Sarbanes-Oxley Act, which dramatically changed accounting rules for companies. The new standards restrict what accounting firms can do for the public companies they audit, thus forcing businesses to farm out certain accounting activities to others, which now need extra manpower. "Perhaps more than the new business Sarbanes-Oxley has created for accounting firms of all sizes is the fact that the new rules have simply created a need for more people to act as watchdogs to make sure companies are in compliance," notes Challenger.

In addition to accounting, demand is rising for general operations managers. That is expected to add 376,000 jobs by 2012 while sales representatives could add 356,000 positions.

The quest for workers in these and other areas of business further is evidenced in that they are among the occupations showing the biggest gains in starting salaries. The National Association of Colleges and Employers reports that beginning salaries for accountants increased 2.4% to $43,050. Other areas showing growth were business administration, up 2.6% to $38,357; economics/finance, up 0.3% to $40,719; and marketing, up four percent to $37,519.

Business is not the only field where this spring's graduates will be in demand. Those with technical skills, whether it is electrical engineering or computer science, will be sought after as well. "The practice of off-shoring is sending many jobs overseas, but there is still a lot of job growth here as companies expand into new areas. Additionally, companies need a hands-on presence to manage projects and provide technical services that cannot be done from the other side of the globe;' Challenger observes.