May 12, 2015
Eight in 10 College Graduates Feel Prepared For the Workforce Despite Nearly Half of Young Employees Being Underemployed, According to Research from Accenture
Accenture Strategy 2015 U.S. College Graduate Employment Survey reveals employer struggle with talent retention
NEW YORK; May 12, 2015 – The vast majority of 2015 U.S. college graduates are confident about their working future, with eight in 10 reporting that their education prepared them well for the workforce, according to research from Accenture (NYSE: ACN). This optimism contrasts starkly with 2013 and 2014 graduates, nearly half of whom (49 percent) consider themselves underemployed or working in a job that does not require a college degree – a steady increase from 46 percent of grads surveyed in 2014 and 41 percent of those surveyed in 2013.
The Accenture Strategy 2015 U.S. College Graduate Employment Survey polled 1,002 students graduating from college in 2015, and 1,001 students who graduated in 2013 and 2014, to compare the perceptions of students preparing to enter the job market with the experiences of recent graduates in the workforce.
Class of 2015: Resourceful and Pragmatic
Eight in 10 (82 percent) 2015 graduates report that they considered the availability of jobs in their intended field before selecting their major, up from 75 percent of 2014 graduates, and nearly three-quarters (74 percent) say that their college was effective in helping them find employment opportunities, up from 63 percent of 2014 graduates. Seven in 10 (72 percent) participated in an internship, apprenticeship or co-op during college, up from 65 percent of prior year graduates.
“The latest crop of college graduates are highly resourceful and pragmatic –a positive sign for both students and employers,” said David Smith, senior managing director, Accenture Strategy. “Unfortunately, while many organizations are focusing on attracting top young talent, they’re struggling to provide learning and development opportunities for them once they join. Companies need to develop a talent supply chain that addresses continued development and retention with the same rigor it does recruiting.”
The research also found that current students are increasingly turning to two-year colleges, with more than one-third of 2015 graduates (34 percent) beginning their studies at a two-year college before continuing with a four-year degree, up from just 18 percent of those who graduated in 2013 and 2014. In addition, 63 percent of 2015 graduates say they were encouraged to pursue Science, Technology, Engineering and Math (STEM) degrees, while 36 percent were discouraged from pursuing a liberal arts degree.
2015 Graduates Hold High Expectations for Ongoing Development, Salary and Job Prospects
The disappointing provision of learning and development continues with more than three-quarters (77 percent) of 2015 graduates expecting to receive formal training in their first job, but only 53 percent of 2013 and 2014 graduates reporting that their employer provided such opportunities.
“Year after year, graduates voice a strong desire to learn on the job and expect to receive formal training from their employers. In fact, this issue is so important to young employees that nearly one quarter of 2015 graduates plan to pursue learning and development opportunities outside of the workplace,” said Yaarit Silverstone, managing director, Accenture Strategy. “Employers who fail to create career development programs and a clear path for advancement are missing a tremendous opportunity to attract and retain top talent.”
In terms of salary, only 15 percent of this year’s graduates say that they expect to earn $25,000 a year or less in their first job, while almost three times as many 2013 and 2014 graduates (41 percent) report an income in the same range. More than half (58 percent) of 2015 graduates report that they will leave school with up to $50,000 in student loan debt and another 13 percent say they will carry debt between $50,000 and $200,000.
More than half (52 percent) of pending graduates do not anticipate difficulty finding a job, though just one in 10 (12 percent) have a job lined up at the time of the survey. Choice of major plays a role in employment prospects with more than three-quarters (78 percent) of 2013 and 2014 business students employed in the areas of their studies, compared to just 58 percent of those with arts and humanities degrees.
New Graduates Value Employer Culture
The Accenture Strategy survey found that organization culture continues to be important for graduates, with 60 percent of the 2015 class saying that they would prefer to work at a company with a positive social atmosphere and receive a lower salary, than receive higher pay at a company that is less fun. Those already working are even more likely to agree, with 69 percent of 2013 and 2014 graduates prioritizing work environment over salary.
“Graduates are very clear on what they want from an employer: a positive environment, meaningful work and opportunities for advancement,” said Smith. “The fact that just 15 percent of 2015 graduates say that they would prefer to work for a large, corporate company implies that these organizations are falling short of expectations. All employers have an opportunity to shape their culture in a way that will attract young employees and keep them engaged.”
Meanwhile, the boundaries between the workplace and personal life continue to blur with new graduates showing more willingness to socialize in the office, date within their professional circles and conduct personal business during work hours – usually at higher rates than their 2013 or 2014 counterparts.
Employer Recommendations: Five Ways to Attract and Retain Top Entry-Level Talent
Accenture Strategy offers five recommendations for employers to strengthen their entry level talent pipeline:
- Digitize the talent pipeline. Nearly two-thirds (64 percent) of 2015 graduates plan to or have used a mobile app to search and apply for jobs, versus 36 percent of 2013 and 2014 graduates. Social networking is considered the most effective method of finding a job (27 percent), beating word of mouth (15 percent) and electronic job boards (14 percent). Employers must continue to invest in digital channels to attract entry-level talent and differentiate the recruitment experience.
- Recast entry-level talent. Nearly three-quarters (74 percent) of 2015 graduates expect to stay with their first employer for three years or more, versus just 43 percent of 2013 and 2014 graduates. It is important for employers to offer entry-level employees challenging work and a culture of growth and advancement.
- Bolster broad development opportunities. Most graduates expect to return to school to further their careers. Just under two-thirds (64 percent) of 2015 graduates believe that they need to pursue further education to get the job they want. Organizations should invest in learning and development to differentiate themselves as an employer of choice, but also develop skills within the workforce.
- Invest in the employee experience. After salary and benefits, graduates value interesting and challenging work (39 percent); flexible work hours (37 percent); and opportunities for rapid advancement (34 percent). Companies must ensure their working culture and environment appeals to the best talent.
- Engage talent early. Of the 72 percent of 2015 graduates who participated in internships, more than half (51 percent) say that it led to a job post-graduation. Internships, apprenticeships and co-ops help employers to access high-quality talent and determine if they are a good cultural fit.
Accenture Strategy conducted an online survey in the United States of 1,002 students graduating from college in 2015 and entering the job market, and 1,001 participants who graduated college in 2013 or 2014. The survey was conducted in March 2015. Learn more at www.accenture.com/collegegradresearch.
Accenture is a global management consulting, technology services and outsourcing company, with more than 323,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$30.0 billion for the fiscal year ended Aug. 31, 2014. Its home page is www.accenture.com.
Accenture Strategy operates at the intersection of business and technology. We bring together our capabilities in business, technology , operations and function strategy to help our clients envision and execute industry-specific strategies that support enterprise wide transformation. Our focus on issues related to digital disruption, competitiveness, global operating models, talent and leadership help drive both efficiencies and growth. For more information, follow @AccentureStrat or visit www.accenture.com/strategy
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