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Most seem to have realistic starting salary expectations, study finds
Most undergraduates, encumbered with high student loans, want to make good money after college and are willing to give up greater job security and richer benefit packages in exchange for bigger paychecks, a new study finds.
College students participated in a series of nationwide polls between July 8, 2016, and June 5, 2017, sponsored by LendEDU, a Cedar Rapids, Iowa-based marketplace for private student loans. When 3,617 were asked which of three company aspects was most important when deciding where to work, they answered:
"Good pay was expected to be the most selected answer, but it was not expected to blow away the other answers like it did," said Mike Brown, research analyst at LendEDU and author of the firm's
Class of 2017 Career Report. "This poll indicates that college graduates only have their mind on the money, even though the other options could be just as valuable."
If there was ever a time to make less money, Brown pointed out, it would be right out of college. "The opportunity to make more money will always be there down the road, but a resume-boosting training program or a strong ethical culture that instills good values may not."
[SHRM members-only toolkit: Practicing Strategic Human Resources]
When 1,816 college students were asked "What do you expect to make at your first job after college?" they responded:
"Most college graduates should expect to see a salary between $40,000 and $60,000, so the plurality of respondents were on the right track," Brown said. "Additionally, many recent graduates could expect to see a salary under $40,000, which was the second most common answer. This poll question seems to indicate that graduates have a realistic grasp of their expected salary levels."
That being said, he added, "The 17 percent of respondents who are expecting to make over $80,000 out of college should begin tempering their expectations so they are not as disappointed. Very few college graduates will make that salary in their first job out of college."
Benefits vs. Security
When 1,808 students were asked if they would prefer a rich benefits package to better job security:
When 3,103 college students were asked if they'd rather work for a very small startup or a larger, more established company:
"Startups are also less secure than larger companies and will usually offer more perks than the bigger workplaces," Brown said. "So it would make sense that more men were willing to work at a startup because more men were also willing to take on a job with less security."
Lack of Financial Savvy
In response to a question asked of 3,776 college students, a plurality (48 percent) said the scariest part of the "real world" is "having to pay taxes and set a budget."
"Whether it is their fault or the education system's fault, students have a serious lack of knowledge when it comes to financial literacy," Brown said, which is why more employers are using
financial education and counseling as a benefit to attract younger workers.
Related SHRM Articles:
Little Growth in Student Loan Assistance Benefit, but Need Is Real,
SHRM Online Benefits, June 2017
The Class of 2017: What They Expect from Their First Jobs, SHRM Online Talent Acquisition, June 2017
New College Grads Reap Higher Starting Pay,
SHRM Online Talent Acquisition, June 2017
Early Forecast: 2018 U.S. Salary Budget Increase Pegged at 3.2%,
SHRM Online Compensation, June 2017
Starting Salaries for 2017 College Grads Hit All-Time High,
SHRM Online Compensation, May 2017
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