Job outlook for newest grads: be positive, but be prepared
A shift in thought
Having watched older Millennials struggle with the Great Recession, today's college graduates exude a practical optimism. They've prepared well and face the strongest job market since the downturn.
CULVER CITY, Calif. — Liliana Sedano received her first full-time job offer before she got her diploma.
She starts in sales and business development at Oracle, a global computer software corporation, at the end of May – just weeks after graduation. Getting here took five years, courses at three community colleges, a series of internships and part-time jobs, and a business degree from the University of Southern California.
But already Ms. Sedano is ticking off her next set of goals: buy a car, own a home, and someday start a nonprofit with the skills she picks up in sales and administration.
“I think I’m being optimistic, but I'm [also] trying to plan everything out,” she says. “I’m literally making a list of things I need to do for what I want. I was at the bank for a car loan and I did get approved. I’m already looking up mortgages, even if I’m not going to purchase [a house] right now.”
In her earnest approach to college and career, Sedano demonstrates a sense of practical optimism emerging among younger Millennials and the next generation, known as Generation Z. Having watched older Millennials struggle with the challenges brought on by the Great Recession, the cohort next in line is coming of age with the notion that they need to come prepared to face an unforgiving job market – even though 2016 graduates are entering the strongest job market since the downturn.
The shift speaks to how factors at play during the formative years have a profound influence on generational attitudes. The values generations grew up with, the goals they were encouraged to reach for, and the economic and political challenges they witnessed before they hit college age tend to have a heavier hand in shaping their worldview than what happens to them after they graduate, researchers say.
“How [members of a generation] react to economic adversity depends on who they already are generationally,” says Neil Howe, a historian and demographer who has authored more than a dozen books on generations and demographic change. “There’s so much about what a generation is in childhood and before college … that conditions how they respond to adversity.”
'Follow your dream'
The idea explains why most Millennials – despite facing soaring housing rates, stagnant starting salaries, and record amounts of student debt – remain stubbornly optimistic about the future.
“One of the hallmark traits of Millennials is they’re very positive about their future,” Mr. Howe says. “It’s almost a generational trait.”
Indeed, reports by organizations such as the Pew Research Center, Wells Fargo, the Urban Institute, and others have shown that Millennials’ upbeat views on both their personal financial futures and the future of the nation persist amid tough economic and political times.
Why? Because they were raised to think that way, says Hannah Ubl, a Millennial writer, speaker, and consultant with generational research firm Bridgeworks, based in Minneapolis. When older Millennials were growing up, she says, “Adults were like, ‘Follow your dream. You will figure out how to pay the tuition. Don’t worry about it.’ ”
“You weren’t told you were going to have thousands of dollars in student debt,” she continues. “You didn’t think about it because you didn’t see people losing their homes growing up, didn’t see that you would basically create wallpaper with rejection letters.”
By the time they came of age – about the same time the Great Recession wiped out millions of jobs almost overnight – most Millennials had internalized the notion that they would succeed despite the odds, she says.
“It’s this idea of, ‘I know it was tough for me to get a job. But I still believe my dreams are out there,’ ” Ms. Ubl says. “What you experience during your formative years, the economic climate around that time and how it influences you, has a pretty profound impact on how you respond to challenges.”
It’s a trend that other generations have borne out in distinct ways. Howe, the demographer, points to how the Silent Generation – born between the mid-1920s to the early 1940s – grew up in a post-World War II environment that encouraged them to conform, follow the rules, and stay the course, with the promise of a comfortable retirement.
“Young people of that time interpreted almost all adversity as an excuse for very risk-averse behavior toward their future,” Howe says. “Everything about that generation and how they behaved showed it was one of trust, patience, fitting in, making long-term decisions at a very early age.”
By contrast, he says, members of Generation X – born between the early 1960s and the very early ‘80s – were raised during a time of great social and cultural upheaval, when feminism, the sexual revolution, and later, the LGBT movement were taking hold.
“Family life became very disordered, and parenthood was very hands-off,” Howe says. “And the hallmark for [that] generation was making it on your own, being self-sufficient, not relying on your parents.”
'A shift in mindset'
The negative effects of graduating in a bad economy – like earning lower wages than those who graduated in a time of high employment, and settling for whatever job is available instead of one that matches a graduate’s qualifications – could and does last decades, studies show.
“[A] person who graduates in a bull market and goes to work in investment banking upon graduation earns an additional $1.5 million to $5 million relative to what that same person would have earned if he or she had graduated during a bear market and had started his or her career in some other industry,” wrote Paul Oyer, a professor of economics at Stanford University, in his 2008 study comparing MBA students who started in finance right away with those who, because of a bad economy, didn't or couldn't.
Bombarded with such messaging, younger Millennials and members of Generation Z have begun to develop a more practical approach to future success – even though the chances for landing jobs right out of school are improving, college placement officers say.
Employers are expected to hire 5.2 percent more new graduates from the class of 2016 than 2015, representing a gradual but steady increase over the last four years, according to the National Association of Colleges and Employers. Graduates with business and technical degrees are most in demand, but enterprising students like Sedano at USC, who started her job search in the fall of her senior year, have high odds of getting hired, regardless of their major. This year, according to consulting firm Accenture, 21 percent of college graduates accepted a job before graduating, up from 12 percent in 2015.
“It is a much improved job market,” says Craig Schmidt, executive director for career and professional development at the University of California, San Diego. “We can certainly talk about the growing number of opportunities for students that are available.”
Still, a sense of caution has crept into younger generations’ attitudes even as employers have dialed back their hiring plans in recent months.
Aalhad Patankar, a senior weeks from graduation at the University of California, Los Angeles, says that he decided to major in bioengineering because it has a high chance of getting him steady employment. And while he enjoys programming and harbors hopes that he can help people with the products he might some day create, the line of work is a dramatic shift from his original dream of writing for a living.
“My dad would be like, ‘Pick a major that benefits you, pick a job that’s stable,’ ” Mr. Patankar says. “I love writing, but part of me bought into it: You could always write, but it’s hard to bioengineer on the side.”
“Parents of younger Millennials do have a bit of a mindset of, ‘I want to follow my dream but I also know that if I don’t have money to afford anything in my life, it’s not worth it,’ ” says Ubl at Bridgeworks.
“It’s a shift in mindset,” she says. “The way they talk about debt, the way they talk about their future and saving for retirement, is so different [than the way older Millennials do]. Because the conversation changed when they were growing up.”
Which isn’t to say other, much-touted Millennial attributes – such as valuing fulfillment in work, taking time to pursue one’s passions, and relishing teamwork – have begun to fade. Even Sedano, the USC graduate, balances her goal-oriented lifestyle by making sure she spends time baking, painting, and drawing – all things she loves to do. She also hopes that her new job will keep her happy as well as help finance a new car.
“I feel like I'd be more efficient and productive if I worked at a company I enjoy ... and where I have a good team with good synergy,” she says.
“I want to do a lot of things. And you can do a lot of things,” she adds. “I feel like people should enjoy their life to the fullest, and do what they love.”