The class of 2023 is graduating into a challenging job market
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After a year of the Federal Reserve’s efforts to cool the job market, private-sector hiring decelerated in March as company payrolls rose by just 145,000. With the labor market tightening, it’s not very easy to get your foot in the door, especially if you’re soon to exit college or a recent graduate.
Some companies are curbing their plans to hire new grads or cutting internship programs, and the unemployment rate for college graduates between ages 20 and 24 most recently registered 4.6%, double its level at the end of 2021. On top of that, student loan repayment is expected to resume soon, so for many, finding a source of stable income is a high priority.
Lindsay Ellis is a reporter with The Wall Street Journal. She joined Marketplace’s Reema Khrais to talk about what it’s like for the class of 2023 to be entering the workforce right now. The following is an edited transcript of their conversation.
Reema Khrais: So you’ve been talking to soon-to-be college grads about their job prospects, about how they’re feeling. What sorts of stories are you hearing?
Lindsay Ellis: Yeah, it’s been a range. I spoke with one student who has applied to between 50 and 100 jobs. She’s at Texas A&M, and she hasn’t really gotten a lot of traction. I’ve also talked to other students who, you know, maybe have found success or have gotten some interviews, but it’s not exactly in the field or the exact role that they had thought about when they initially started their job search. One thing that I’ve been hearing is that students are more willing to cast a wider net in response to some of the labor news and the jobs news that we’ve all been following over the last stretch. And so, while I think — to take a step back — there are jobs, it is a longer journey than many soon-to-be college grads would like.
Khrais: Yeah, I’m hearing similar things. I actually have a brother, he’s a much younger brother, who’s graduating from college this year. He’s scrambling to find a job. And it is just a strange time in the economy, right? Like, just these last couple of days on the show, we’ve been reporting on how hot this labor market has been, but now we’re seeing a bit of a cooldown. It gives you whiplash. And it’s complicated because it’s not that hiring all across the board is waning, right?
Ellis: Yeah. I mean, I think that was really well said. And, you know, yes, the unemployment rate is quite low. But the broader context here [is that] many companies who typically hired these individuals have laid off many thousands of workers over the last few months. And that means that while there are still jobs out there, new grads are going to be competing not just with one another, but with many other early-career folks who are suddenly out of a job. And so that dynamic, I think, is also making things a little bit more complicated.
Khrais: We know that the first job out of college can be pretty critical to starting your climb up the job ladder. What kind of long-term impact might we see from this?
Ellis: It’s a great question. You know, there has been some research about graduates who enter the workforce in a recession and that their earnings lag graduates who don’t enter into a recession. But the U.S. is not technically in a recession right now, so I think that’s sort of speculative at this point.
Khrais: Yeah. And I want to briefly touch on student loans. The pause on repayment is almost over. How much of a factor do you think that that is for new grads as they’re searching for jobs?
Ellis: So when I talk to young professionals and students, you know, salary is definitely high on the list of areas that are really important to them. But many grads are really looking for a company that will offer stability. And yes, I mean, salary is key — especially for those who have taken on debt and will need to start repaying those loans. But grads who I talked to are really hoping to land at a company [where] they will, you know, hopefully be shielded from layoffs or contractions.
Khrais: Given what we know — I mean, obviously, there’s a lot we just don’t know of what’s to come — what would your advice be to new grads or soon-to-be grads?
Ellis: I’m not really in the advice business. But I will say that, you know, the grads that I talked to, they are working really hard to get that first position. I mean, working just any possible connection to get a foot in the door or to get a conversation. And others, you know, we see all of these LinkedIn posts from folks who have been recently laid off and that those get traction. So some soon-to-be grads are doing the same thing, saying, “Hey, graduation is coming up. Here’s where I am in the search.” And one person who I talked to said that such a, such a viral post can lead to connections with alums or recruiters.
Khrais: “Hire me!”
Ellis: Yeah, exactly what you said. “Hire me, please!”
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