Where Top College Grads Are Going for Work, and Why

Recent college graduates entering the workforce are facing an assortment of challenges: an uneven U.S. job market, inflation translating into pressure to land a high-paying job, trouble finding positions that align with their undergrad degrees, and the disruption to business across sectors caused by artificial intelligence.

An analysis that the Federal Reserve Bank of New York released in March showed that recent college graduates between the ages of 22 and 27 had a 4.7% unemployment rate, compared with a 3.7% unemployment rate for all workers and a 2.2% unemployment rate for all college graduates. The New York Fed report also showed that unemployment and median wages differed drastically based on academic majors.

Those who majored in industrial engineering had the lowest unemployment rate, at 0.2%; followed by those who majored in construction services, at 0.4%; and medical technicians, also at 0.4%. College grads who majored in computer engineering had the highest median wage early in their careers, at $80,000; followed by those who majored in chemical engineering, at $79,000; and computer science, at $78,000. Finance majors had an unemployment rate of 2.7% and a median wage early in their careers of $66,000.

The 2024 Monster State of the Graduate Report survey of 1,000 18-to-24-year-olds found that 67% of new and impending college graduates think employers have more leverage in finding the best candidate than job seekers do in seeking the best jobs. Slightly more than three quarters of graduates (77 percent) are concerned about job security while seeking a job, meaning those who already have jobs are worried about compromising their positions.

Yet the Monster survey also found that a high percentage of college grads have very specific requirements for potential employers. Approximately 60% would not apply to a company that is mandating a return-to-office five days a week, 59% would not apply to a company that is completely remote, and 42% would turn down a job at a company that doesn’t offer flexible or hybrid work schedules.

City Rankings

According to a MarketWatch Guides survey of more than 1,000 recent college graduates, Pittsburgh tops the list of best locations for them across the 70 largest metropolitan areas in the U.S., followed by Indianapolis; Dallas; Louisville, Kentucky; and then Detroit. MarketWatch generated overall scores for the metro areas based on cost of living, job availability, housing availability, rent-to-income ratios, and population aged 21 to 29 per the U.S. Census Bureau.

The same survey also found that 68% of respondents were open to relocating to a different city for a job opportunity. Regarding work arrangements, 44% of respondents preferred hybrid work, 36% preferred remote work, and 20% preferred in-office work. On average, respondents had $9,927 saved after graduation, with almost a fifth of respondents having saved no money after college.

Realtor.com came up with a different list of locations for its 2024 Top Rental Markets for Recent College Graduates. It ranked 313 cities and towns with a population of more than 75,000 and are located within the 50 largest metro areas. Placing first is Austin, Texas; followed by Bloomington, Minnesota; Pittsburgh; Raleigh, North Carolina; and then Overland Park, Kansas.

The ranking focused on rent-to-income ratios, college-grad-friendly occupations, average commute time, culture and lifestyle venues as listed on Yelp, a measure of job stability based on the unemployment rate forecast, the number of recent college graduates in a city, rental vacancy rates, and openings based on the Indeed Job Posting Index.

Zumper, a marketplace of houses and apartments for rent, provided yet another list with its recently published Best Cities For College Grads. From highest to lowest, the top five were Minneapolis; Denver; Seattle; Columbus, Ohio; and San Francisco. This list looked at factors such as the median one-bedroom rent on Zumper.com, the population of 18-to-34-year-olds, the unmarried population, the population of 25-year-olds with Bachelor degrees, and the number of restaurants per 100,000 people.

California had four of the five cities with the highest median income for people 25 and younger – San Francisco, Oakland, San Jose, and Anaheim – with Scottsdale, Arizona, placing fourth in the category. Madison, Wisconsin, which placed 39th out of Zumper’s 100 best cities overall for college grads, had the lowest unemployment rate on the list.

Major employment hubs such as New York, Los Angeles, Chicago, Atlanta, and Washington, D.C., are conspicuously missing from the top five positions of the above rankings. And New York ranked as the absolute worst out of 182 U.S. cities to start a career in, according to a recent study by WalletHub, which factored in professional opportunities and quality of life.

WalletHub broke down professional opportunities along many subcategories, including monthly average starting salary, median income growth rate, job satisfaction, and highly rated company jobs per total people in the labor force according to Glassdoor.com. It broke down quality of life by subcategories including average length of work week, fun friendliness, family friendliness, average commute time, and housing affordability.

Of course, the results of any survey-based ranking does not necessarily reveal the complete picture. For example, New York City remains home to more than 4 million private-sector jobs; the most Fortune 500 companies; two world-class undergraduate universities, Columbia and NYU; as well as the largest urban university system in the country, CUNY, which serves more than 480,000 students at 23 colleges and institutions.

Collegiate Insights

Ashley Finley, PhD, is the Vice President of Research and Senior Advisor to the President for the American Association of Colleges and Universities (AAC&U). The global membership organization is dedicated to advancing the vitality and democratic purposes of undergraduate liberal education.

Her 2023 report, The Career-Ready Graduate: What Employers Say About the Difference College Makes, is based on a survey of 1,010 executives and hiring managers. It details several findings that are relevant for both top employers and high-potential college graduates. On average, only half of employers said grads were “very prepared” for work in relation to specific skills such as oral and written communication, critical thinking, and complex problem-solving.

“We would argue that the reason employers value these skills is because they are equipping students for the jobs that don’t yet exist,” Finley told This Is Capitalism. “It’s the thing that transcends any position, that makes students nimble enough to morph into the next position, by keeping skills up or re-skilling.”

Microcredentials

The AAC&U reported that most employers said grads possessing a degree with a microcredential were more desirable than grads with just a college degree. Almost 75% of employers reported that they either offer microcredentials or planned to in the future. Microcredentials can be badges, certificates, or other documents that represent a set of technical skills or highly specific tasks, but are less than a college degree.

“What we have with microcredentials is a way to bundle, formalize, and make present what has long been considered ‘the extra’ alongside a college degree,” Finley said. “We don’t want to create these false binaries between professional studies and then the arts, humanities, and the social sciences. We live in a world where that complementarity is going to solve problems and help people to re-skill and upskill.”

The AAC&U report also suggested that the process of advising college students should involve cooperation across faculty, staff, peer mentors, alumni, and business and community members, to help students get the most out of their curricular and co-curricular experiences. Some models also feature an integrative coach who works with the various stakeholders on behalf of a student, an approach that Finley implemented at Dominican University of California.

“It’s a way to bring together an ecosystem of mentoring that in some ways happens on campus anyway, put all of that into alignment, and around the core objectives of what the curriculum and the co-curriculum are supposed to do, which is to build the proper skills,” Finley said. “Faculty are critical to the process, but they cannot be the sole holders of this responsibility, in large part because students build those skills outside of classrooms.”