Four Out of 10 Recent College Grads are Underemployed, New Accenture Research Finds
U.S. employers are underutilizing the capabilities of young,
college-educated workers, according to new
research by Accenture (NYSE: ACN) that reveals that 41 percent of
workers who graduated from college in the past two years say they are
underemployed and working in jobs that do not require their college
degrees. The research also reveals that, despite their degrees, nearly
two-thirds (63 percent) say they will need more training in order to get
their desired job.
The Accenture
2013 College Graduate Employment Survey polled 1,010 students who
will be graduating from college in 2013, and 1,005 students who
graduated from college in 2011 and 2012, to compare the perceptions of
those students preparing to enter the job market with the experiences of
recent grads in the workforce.
The study identified a wide gap between the expectations 2013 graduates
have for employer-provided training and what they are likely to receive
when they start working. More than three-quarters (77 percent) of
pending 2013 graduates expect their first employer to provide formal
training, but fewer than half (48 percent) of 2011 and 2012 graduates
surveyed say they received formal training in their first job after
graduation.
“A solution is sorely needed to bridge the disconnect between employers
that are concerned about college graduates being unprepared for
available jobs and the graduates who feel overqualified for them,” said David
Smith, senior managing director of Accenture’s
Talent & Organization practice. “Hiring someone with a
higher-level degree than is necessary for a given job does not typically
result in a higher-performing employee, and does not reduce the need to
invest in training specialized skills.”
Further underscoring the disillusion felt by recent college graduates,
42 percent of 2011 and 2012 graduates expect they will need to pursue a
graduate level degree to further their career. This is more than twice
as many as only 18 percent of 2013 pending grads who expect to do so.
Nearly a quarter (23 percent) of 2011 and 2012 graduates also plan to
take graduate-level courses or online courses to develop their skills.
“For our nation’s youngest workers, as well as for the workforce at
large, there is a real need for employers to reexamine how they hire,
train and develop their employees,” said Katherine Lavelle, managing
director of Accenture’s Talent & Organization practice in North America.
“Students come out of school with great generalist skills, but need
tailored training to develop the specialist skills U.S. companies need.
Employers need to improve the training they provide, develop deeper
partnerships with universities and explore approaches such as
apprenticeships to ensure they develop the necessary skills in their new
hires and existing employees.”
Accenture recommends employers improve how they hire and develop young
workers coming out of college:
-
Hire based on potential. Let go of the idea of finding perfect
candidates that meet every skills criteria and instead invest in young
people with strong generalist skills who, with some training and
experience (and perhaps some job redesign), can perform in roles you
might not have matched them to at first glance. Use assessments,
performance analysis and skills databases to identify those young
workers with strong potential.
-
Make training part of the total employment package. Training is
a “chicken or the egg” dilemma; young workers need experience to get a
job but they need a job to get experience. Employers cannot assume
recent college graduates will arrive on the job with all the skills
they need. Employers need to provide more, and better, training and
should use it to be an employer of choice.
-
Work closely with educational institutions. Develop work
experience programs like internships or apprenticeships, create
externships for professors and instructors, engage in curriculum
development and create customized training and industry credential
programs. These will help develop a fresh crop of talent that is
better suited to your organization’s needs, and lead to better
matching of students to jobs.
In addition to studying the skills and training gap, the Accenture
2013 College Graduate Employment Survey also explored college graduates’
expectations and experiences with the job market, salary and living
arrangements:
It’s a Challenging Job Market
As of late March, only 16 percent of students who will graduate in 2013
had already secured employment. To secure a job in the current job
market, one-third (34 percent) of the pending 2013 graduates say they
are prepared to accept their first job offer, while 27 percent would
consider working in a field other than their college major.
Of the survey respondents who graduated in 2011 and 2012, 68 percent are
currently employed full time and 16 percent are working part time. More
than half (57 percent) say finding a job was difficult, but 39 percent
had jobs by the time they graduated and another 42 percent were employed
within six months of graduation. However, seven percent say they haven’t
had a job since they graduated in 2011 or 2012.
Among the 2011 and 2012 grads who are unemployed, 48 percent said they
would have fared better in the job market with a different major and 57
percent expect to go back to school within the next five years. Of the
2011 and 2012 grads with a two-year degree, 52 percent say they will
need to get a four-year degree in order to get the job they want.
Working in Your Field of Study Is Not Guaranteed
The study found that the top three industries that 2011, 2012 and 2013
graduates want to work in are education, media & entertainment and
healthcare.
Nearly two-thirds (64 percent) of pending 2013 college graduates expect
to be employed full-time in their field of study, compared with 53
percent of 2011 and 2012 graduates who are currently working in their
field of study full time. When 2011 and 2012 college graduates who are
not employed in their field of study were asked why, 45 percent said it
was taking too long to find a job and 32 percent said there were not
enough job openings in their field. Out of the 72 percent of 2011 and
2012 graduates who participated in an internship while still in school,
only 42 percent said the internship led to a job.
Among the students who will graduate in 2013 from a four-year
institution, one-quarter (26 percent) transferred from a junior or
community college, while only 11 percent of the 2011 and 2012 graduates
of a four-year institution began their college education at a junior or
community college.
2013 Graduates Have Outsized Expectations for Salary and Living
Arrangements
Salary expectations among pending 2013 graduates are out of line with
the current job market. Only 15 percent of pending 2013 grads expect to
earn less than $25,000 a year, while one-third (32 percent) of 2011 and
2012 graduates who are employed report their current annual salary is
$25,000 or less.
Nearly one-third (30 percent) of pending 2013 graduates and 34 percent
of 2011 and 2012 graduates have $30,000 or less in student loans, while
17 percent of pending 2013 graduates and 13 percent of 2011 and 2012
graduates have student loan debts of $30,000 to $50,000. Of the students
who will graduate with student loans in 2013, 64 percent are taking on
the debt themselves and will pay it off without help from parents.
One-third (32 percent) of pending 2013 graduates plan to live at home
after graduation, while 44 percent of 2011 and 2012 college grads
currently live at home.
About the Study
Accenture conducted an online survey in the United States of 1,010
students graduating from college in 2013 and entering the job market,
and 1,005 participants who already graduated college in 2011 or 2012.
The survey was conducted between March 22 and April 1, 2013.
Learn more at www.accenture.com/CollegeGradSurvey
About Accenture
Accenture is a global management consulting, technology services and
outsourcing company, with approximately 261,000 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$27.9 billion for the fiscal year ended Aug. 31, 2012. Its home page
is www.accenture.com.