What’s that sound you just heard? It’s the sound of the bubble bursting over the heads of many soon-to-be graduates of the Class of 2008. By all accounts, it seems they are entering a market that is quickly getting more competitive as employers slow their hiring pace amid economic uncertainty.
In fact, a new CareerBuilder survey shows that 58% of employers plan to hire recent college graduates in 2008, down from 79% in 2007. That 58% figure is remarkably similar to MonsterTrak data released last month, showing that only 59% of employers plan to hire this spring, a decrease of 17%.
These figures contradict new data from the National Association of Colleges and Employers, which recently suggested that hiring new recruits is expected to be 8% higher than last spring.
(Not surprisingly though, this 8% figure is still half what NACE said last year, at the time predicting a 16% figure for 2008 graduates.)
Of those who are hiring, CareerBuilder notes, 24% expect to hire more recent college graduates in 2008 compared to 2007, and 39% plan to increase starting salaries.
In CareerBuilder’s survey of 3,147 hiring managers and HR professionals, 32% of employers expect to offer recent college graduates starting salaries ranging between $30,000 and $40,000. An additional 15% will offer between $40,000 and $50,000, and 11% will offer more than $50,000. About 42% of new grads will be offered less than $30,000.
Salary Bump Blues
The news isn’t much rosier for the established workforce, either. According to the ERI Economic Research Institute’s evergreen salary increase survey, the average salary budget increase at most companies will be 4% for 2009, down only slightly from the 2008 level of 4.1%.
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The research think tank warns that although this may appear to be a minor decrease, it represents a “distinct change” in direction, as recent years have seen modest increases in salary and incentive budgets.
“U.S. companies are in a bind for talent and skilled knowledge workers. ERI is looking, but we’ve not seen evidence of anything other than concern about the pay of key staff, from those of our 15,000 subscribers who are entering data into our ongoing survey,” says Dr. David J. Thomsen, ERI’s director.
“There’s no recession for key skills and talent. The major disconnect is between wage increases and what’s happening with cost-of-living,” he adds.
Still, he points out that among certain skills groups, the norm is closer to a 6% or 7% increase.
This is due, he cautions, “because of the freeze on H-1B visas and the fact that the U.S. educational system is training our youngsters for non-existent jobs.”