College Grads' Salary Expectations Overblown?
A new survey finds that this year's college graduates may be expecting too much when it comes to entry-level salaries.
By Andrew R. McIlvaine
Depending on their major, college students may be in for a rude surprise when it comes to their starting salary post-graduation. The 2017 Yello Collegiate Survey -- Undergraduate Expectations finds that 65 percent of college students expect to make more than $60,000 as an entry-level salary. However, the Winter 2017 Salary Survey report from the National Association of Colleges and Employers finds that while employers anticipate boosting their average starting salaries for most majors this year, those for all but a few STEM majors are projected to average below $60,000 -- in some cases, well below that number.
This divide between expectations and reality will require employers to do a bit of selling, says Yello President and Co-founder Dan Bartfield.
"To bridge the divide, employers can outline clear career paths, highlight steps necessary to reach the next rung on the corporate ladder and provide examples of employees who've risen through the organization," he says.
Yello's survey of 1,700 current college students also finds a gender gap exists between male and female college students, with women 20 percent less likely than men to expect to earn $60,000 or more in their first year of employment.
"As a father of two girls, [this finding] surprised and troubled me," says Bartfield. "While I assume that with each generation we are moving beyond gender biases, this study found that college-aged females are still internalizing messages that promote gender pay gaps."
Companies need to take steps to mitigate these perceptions, he says, such as establishing a more transparent compensation policy that demonstrates gender equality in pay.
The survey also found (not surprisingly) that the top reason college grads choose to work away from their hometowns or universities is to be close to an industry hub and to gain access to influential leaders.
But what about companies that may be located far outside industry hubs such as Silicon Valley, New York or Washington, D.C.?
Those employers still have plenty to work with, Bartfield says.
"When I was in college and looking for my first job, I was impressed with organizations [that were outside industry hubs] that highlighted low cost-of-living, low traffic and easy access to airports," he says. Those companies can also highlight mentorship programs that match entry-level hires with senior leaders, quarterly lunch-and-learns with industry experts and access to continued learning, he adds.
The NACE salary report finds that companies expect to offer graduates in engineering and computer science average starting salaries of $66,097 (up 2 percent from 2016) and $65,540 (up 7 percent from last year), respectively. Math and science majors will receive projected average starting salaries of $59,368 (up nearly 8 percent from last year), while business majors can look forward to average starting salaries of $54,803 (up almost 5 percent from last year's average of $52,236).
Social sciences and communications majors may see the biggest gains in average starting salaries this year, with projected gains of 15 percent and 10 percent, respectively. Much of the projected increase for social sciences is driven by economics majors, to whom employers anticipate paying starting salaries of $56,678.
Salaries for humanities graduates -- who may be accustomed to being asked "What are you going to do with that degree in (history, literature, classics)" -- are also expected to see average salary increases that are up by 5.8 percent from last year, to $48,733.