College graduates face tight job market

When Jeffrey Levy finished college in December, he figured by spring he'd be commuting to a new job on Wall Street, earning $40,000-plus a year and celebrating his financial independence by looking for his own apartment.

Four months later, Levy is still planted in his parents' house in Melville, N.Y. He doesn't need to set the alarm clock and his commute is limited to the distance between his bed and the computer, where he logs on day after day, prospecting for a job.

"You try to make a daily schedule for yourself ... just to make yourself feel like you're doing something," says Levy, who earned a bachelor's degree in finance from Hofstra University in Hempstead, N.Y. "Anything to get your mind off the college job market."

Thousands of students, now weeks away from their own graduation ceremonies at college campuses across the country, are encountering much the same discouragement.

It's not just that it's tough to find a job. Even as employers make offers, the extra challenge for the newest entrants to the work force -- most of whom were still in grade school when the country faced its last recession -- is letting the air out of expectations artificially inflated by the past decade's record economic boom.

That means fewer offers, often for less prestigious jobs, at lower pay and with greatly reduced incentives.

"People anticipated when they came into business school that 'If I do well and have a good background, it's all going to happen.' The fact that, all of a sudden, that is not true has sort of a been a mindbender," said Richard Shafer, associate dean of the graduate management school at Cornell University in Ithaca, N.Y.

"It's not that they've never had to look for a job," Shafer said. "It's that they've never faced real adversity."

Change in climate

The change in climate is blowing through just about every campus.

At Cornell and nine other business schools that compare figures, with barely a month until graduation, just 58 percent of MBA graduates have jobs. That is down from more than 80 percent at the same time in recent years. Some students, who headed off to graduate school as a way to change fields or jump up the corporate ladder, are grateful just to be going back to their old jobs.

At the University of Texas in Austin, where engineering graduates were used to being wooed by the states' computer and telecommunications firms, once-common signing bonuses have all but dried up.

"Our students, the really top-notch kids, were getting four and five offers -- and certainly we're not seeing that this year," said Nancy Evans, director of Texas' Engineering Career Assistance Center.

Many electrical engineering students, who had shown a strong preference for newer high-tech firms, are taking jobs in the less glamorous oil and defense industries, she said.

At the University of California at Berkeley, whose graduates were snapped up during the dot-com boom, many companies that did the most aggressive hiring no longer exist. That is compounding a drop in corporate turnout at campus' major job fairs in September and January. Last year, each fair ran three days, with 100 different employers each day. This year, each fair was cut back to two days, with just 90 companies at each session -- an overall drop of 40 percent.

"We do not anticipate going back to three days. That was symptomatic of the great times which will never return," said Tom Devlin, director of California-Berkeley's career center.

Convincing evidence

Evidence of the soft job market goes beyond the anecdotal.

Companies surveyed last fall by the National Association of Colleges and Employers said they planned to scale back campus hiring by 20 percent. But in a new survey, still under way, about a third of employers say they are reducing job offers to graduates even further, said Camille Luckenbaugh, employment information manager for NACE.

"Two years ago you had people going to spring break trying to get people on board," she said. "It's just an incredible shift."

More than 140 schools surveyed by NACE report salaries offered many of their graduates are down this year. Most business administration majors are taking positions as trainees instead of consultants, for average pay of $35,200, down 7.1 percent from last year.

Students majoring in logistics and materials management are also settling for trainee positions, with pay averaging $39,800, down 12.3 percent.

"Students are sometimes very disappointed by the obvious opportunities that come in their direction and they are sort of trying to figure out whether to compromise," said Marvin Reed, director of The Career Center at Hofstra.

There are exceptions. Accounting graduates, nearly always in short supply, are averaging $40,300 salaries, up 3.2 percent from last year, according to NACE. Graduates from the nation's schools of pharmacy are also in demand, fielding multiple offers from fast-expanding drug store chains, jobs that pay that $70,000 a year or more, career counselors say.

But for the great majority of students, there's much less to celebrate.

Ask Trey Poore, a 22-year-old international business major at Alabama's Auburn University who will graduate in May. He's been looking for a job while working part time in the school's placement office, advising classmates on their search efforts.