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Salaries College Graduates are Expecting
Despite the ongoing effects of the Covid-19 pandemic, college students are optimistic about their future employment opportunities.
About 17% of students expect to earn more than $85,000 per year from their first job after graduation, according to a recent survey by AIG Retirement Services and EVERFI of over 20,000 college students nationwide. The $85,000 starting salary was the most common response from students.
While an $85,000 salary might seem like a surprisingly high starting point, it’s not that far off from official projections for some majors. The average post-grad salary for those majoring in computer sciences in the Class of 2021 is $72,173, research from the National Association of Colleges and Employers shows. That’s a roughly 7% increase from last year’s estimate of $67,411 for those majors.
Prior to the pandemic, the average starting salary was $53,889 for those in the Class of 2019 earning a bachelor’s degree.
Half of the students surveyed by AIG and EVERFI say finding a job after college is something they stress about, but that’s a lower percentage than in previous years. And 39% say they don’t expect Covid-19 to have an impact on their job search once they graduate, which is probably especially true for the freshman and sophomore college students surveyed.
It makes sense that college students are optimistic, says Rob Scheinerman, CEO of AIG Retirement Services. He notes that vaccines are becoming broadly available, stimulus checks were just sent out to millions of families, federal student loan payments and interest are still frozen and there are lots of job openings.
“In the face of real hardship and challenge, the students have shown resilience and fortitude, and confidence in making a go of it when they graduate,” Scheinerman says.
Yet much like the broader population is experiencing the effects of the so-called “K-shaped” recovery, where different cohorts are seeing very uneven financial outcomes, college students should also be prepared for an unequal experiences as they head out into the job market, Scheinerman says. Those earning degrees in the sciences, for example, may find better job prospects than those with degrees in fine arts. And that was true even before the pandemic.
NACE’s winter 2021 salary survey found that those graduating with degrees in computer science and engineering could expect to receive the highest starting salaries, while those in communications and agriculture and natural resources will likely receive much lower offers.
Some grads may be able to find high-paying jobs quickly, but others will struggle, Scheinerman says. Regardless, he emphasizes the importance of developing solid financial habits, such as saving for retirement early, putting aside money in an emergency savings account and limiting the use of high-interest credit cards.
“The challenges created by the pandemic could linger, so good financial habits will continue to be important for college students, as well as for graduates just beginning their careers,” he says.