COVID-19 and the Class of 2020: Good news / Bad news

(Covid-19 Outbreak, Image credit: YouTube)

On December 9, the National Association of Colleges and Employers (NACE) released a report showing that the class of 2020 graduates got fewer jobs than any of their counterparts since 2014. At the same time, however, those who did secure jobs garnered higher starting salaries.

NACE’s First Destinations for the College Class of 2020 reports that only 50% of the bachelor’s degree graduates from the class had full-time jobs with a traditional employer within six months of graduation.* In comparison, more than 55% of Class of 2019 graduates were employed within the same time frame. (See Figure 1.)

“The COVID-19 pandemic had a significant effect on the job market for the Class of 2020, and our report illustrates that,” notes Shawn VanDerziel, NACE executive director. “In terms of employment within six months of graduation, 2020 graduates had the worst outcomes since we began tracking with the Class of 2014.”

VanDerziel points to the current unemployment figures as evidence that, despite a rocky start, Class of 2020 graduates landed on their feet. “The current overall unemployment rate is—and has been for several months—below 5%. That bodes well for everyone, including 2020 graduates,” he says.

Referring to statistics provided by the U.S. Bureau of Labor Statistics (BLS), VanDerziel adds, “If you look just at the unemployment rate for young graduates, you will see marked improvement, again a good sign for 2020 graduates.”

According to BLS, the unemployment rate for bachelor’s degree graduates ages 20–24 fell from more than 20% in June 2020 to less than 5% in November 2021.

Despite the bleak employment picture 2020 graduates initially faced, those who did secure full-time jobs did well in terms of starting salary.

“Overall, the average salary for Class of 2020 graduates was $56,576—up from $54,488 for 2019 graduates,” VanDerziel said.

Why?

“The likely explanation is that many of the jobs that new graduates often get right out of college disappeared due to the pandemic,” says VanDerziel.
“Many of the retail, hospitality, and other service-focused jobs simply weren’t there, and these tend to be lower paying. As a result, most of the salaries that were reported were the higher-paying jobs, which skewed the average.”

Other highlights from the report include:

Graduates in engineering, engineering technology, health sciences, business, and computer science fared best in securing a full-time job within six months of graduation. This is consistent with previous years.
A greater portion of the class opted to pursue further education: 21.1% of 2020 bachelor’s degrees graduates had secured a place to pursue an advanced degree within six months of graduation, compared to 18.6% of their 2019 counterparts.
14.1% were still seeking employment, and 3.4% were still seeking a placement to pursue an advanced degree. In contrast, just 11.1% of 2019 graduates were still seeking employment and 2.7% were still seeking further education six months after graduation.

Figure 1: First Destinations – Employment Trends

(Source: First Destinations for the College Class of 2020. National Association of Colleges and Employers. Data represent percent of bachelor’s degree graduates in the class with a full-time job with a traditional employer within six months of graduation.)

In traditional (or standard) employment, a graduate works for an employer with relatively steady work hours, a defined wage/salary, and a presumption of benefits. This is in contrast to graduates who are contract, freelance, or temporary workers; those who have started their own businesses; or those who are engaged in a post-graduate fellowship.

The survey that resulted in First Destinations for the College Class of 2020 is the seventh in a series that began with the college Class of 2014. Each year, the survey is conducted through individual colleges and universities nationwide, which then report their results to NACE.

The class year for 2020 graduates is defined as July 1, 2019, through June 30, 2020. The schools conducted the Class of 2020 survey from graduation through December 30, 2020, and reported their data to NACE from January 6 through April 30, 2021. All data in the report are as of December 30, 2020.

In total, NACE received reports from 342 schools; they reported outcomes for graduating classes totaling more than 757,000 students in four degree programs—associate, bachelor’s, master’s, and doctoral-level programs. Data presented in this release are for bachelor’s degree graduates.

First Destinations for the College Class of 2020, featuring an executive summary of findings, two special briefs, and interactive dashboard, is available free through the NACE website. In addition, results for previous classes can be accessed on the NACE website.