Flat Job Market and Virtual Hiring Forecasted
FLAT JOB MARKET AND VIRTUAL HIRING FORECASTED
By Stuart Esrock, Ph.D.
A new national study indicates that while employers will continue to hire Class of 2021 graduates, there will be little near-term growth in the job market. The National Association of Colleges and Employers (NACE) has released results of its annual "Job Outlook" survey and reports that overall in 2021, organizations will maintain hiring nearly equal to 2020 levels (-.1% is forecasted).
NACE terms the outlook as better than expected given the continuing impact of the COVID-19 crisis and an uneven economic recovery. While close to 53% of respondents to NACE’s survey plan to maintain their hiring levels, only 16.5% will increase and 31% plan to decrease. Those planning drops cite reductions in their business, budget cuts, and the uneven economy that have all been impacted by the pandemic.
Most of the projected increases in hiring will come from larger companies. NACE reports that only companies with more than 10,000 employees will increase new graduate hiring with the largest forecasted increase of 6.3% for employers with 20,000+ employees. The largest decrease of 28% is reported for companies with 5,000 to 10,000 employees.
Although a limited number of companies in various industries responded to the survey, the biggest increases in 2021 hiring are projected for chemical manufacturing, miscellaneous support services, and the information industries. The following chart includes expected changes in hiring between 2020 and 2021 for the 16 industries that had the largest number of respondents to the NACE survey.
Virtual/online technology will be the norm for the hiring process according to NACE. 54% of respondents will rely on that technology for the entire year, while another 16% used virtual/online in the fall but will try to transition to in-person hiring in the spring.
Nearly 90% of companies in the study indicated they have a diversity recruiting strategy for 2021. NACE said only its 2018 study reported a higher level of diversity recruiting. All employers with more than 20,000 employees reported diversity initiatives.
The picture is not great for 2021 graduates when it comes to starting salaries. While more than two-thirds of companies said they would increase starting salaries in 2020, the 2021 survey indicates just 42% will hike initial compensation at an average increase of 3.3%.
The director of UofL’s University Career Center, Bill Fletcher, agrees with the NACE assessment of the 2021 job market. “National positions posted in our Handshake career management system are down about 20% this year when compared to the same period last year. That said, there are employers who are hiring entry-level talent so students should utilize their career centers to be prepared for the job market. It is competitive but good opportunities clearly exist.”
The NACE 2021 Job Outlook was based on data collected in July, August, and September of 2020. The results include surveys from 158 NACE member companies and 69 non-members.