College Job Market to Improve, but Not Enough

The job market for recent college graduates will rebound slightly next year, according to a study from Michigan State University, with overall hiring expected to increase 3% over last year and hiring of those with bachelor's degrees expected to jump by 10%. The 2010 to 2011 study, called Recruiting Trends, is based on answers from 4,600 companies.

But the news isn't all good. The uptick in job additions is limited to only 300 or 400 companies in the survey -- most of them very large firms or rapidly growing smaller ones. Midsize companies, the report says, may continue to cut jobs.

While the situation for MBAs looks pretty good, the study forecasts a decline in hiring for those with other graduate degrees.

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For student's with average grades the picture is also pretty gloomy. Most companies will only hire from the top tier of talent. Even for them, salaries are down considerably compared to what they were before the recession. "Salaries have dropped precipitously in the last two years, from $46,500 in 2008-2009 (at the bachelor's level) to $36,866 this year, a decline of almost $10,000." Some of this is due to a change of the sample size of the research base, but much of it is certainly due to the recession.

The data in the report is a microcosm of the national employment picture. Many companies are in a position to hire when they want and pay what they want. This is due to several factors. One is an increase in productivity throughout most of the recession. Companies have squeezed more work out of their existing workforce. People are probably willing to do more without additional compensation to stay off unemployment lines.

Another reason for the change in the job landscape is that more skilled older workers are competing with younger counterparts for work. The recession and a drop in equity markets, which damaged the retirement accounts of many people over 55, has pushed many older workers back into the job market place.

And probably the harshest reality for college graduates is that many firms believe the recession isn't over -- or that there's a reasonable chance of a double dip. These firms won't add expenses until they feel more certain that a real economic recovery is underway.