The Catch-22 for Recent Graduates in the Job Market
For recent college and MBA graduates hitting the job market, they often face a frustrating catch-22 when it comes to getting hired for entry-level roles. On one side are agency recruiters who have great job opportunities – but their clients are rarely willing to pay to hire inexperienced talent. On the other side are in-house corporate recruiters who are more open to bringing in new graduates – but they have to manage unrealistic expectations from hiring managers about what early career hires can deliver.
The Agency Recruiter’s Dilemma
Recruiting agencies make money by filling open job requisitions for their client companies and getting paid a fee, usually a percentage of the hired candidate’s first year salary. It’s in the agency’s interest to place as many candidates as possible. However, most companies engaging agencies are looking for job-ready, experienced professionals that can provide immediate value. They are hesitant to pay recruiters’ fees for entry-level or untested candidates like recent grads. This makes it very difficult for agency recruiters to get paid by placing new graduate hires.
In-House Recruiting Against Inflated Expectations
Corporate in-house recruiters don’t face the same financial disincentive around hiring inexperienced workers. However, they have to navigate the expectations of hiring managers within their company. Many managers drastically underestimate the ramp-up time and training required for an entry-level employee. They expect new grads to hit the ground running and perform at the same level as more seasoned professionals from day one – an unrealistic expectation that in-house recruiters have to push back against.
A Double-Edged Sword for Job Seekers
This puts recent graduates in a tough position. The agencies want to place them but their clients don’t want to pay agency fees for junior talent. Or new grads could go straight to corporate roles, but they may be walking into a pressure-cooker situation with inflated expectations that sets them up to underperform. It creates a perfect storm where agencies avoid grads, corporations undervalue them, and job seekers face heaps of rejection despite their newly-minted degrees.
Breaking the Cycle
There’s no easy solution, but a few things could help break this catch-22:
- Better training programs to accelerate graduates’ job readiness
- More apprenticeship opportunities to ease the transition from academics to careers
- Adjusting salary structures for entry-level roles to reduce the cost barrier
- Educating hiring managers on appropriate expectations for early career employees
No one wins when recent graduates get shut out of opportunities. Companies miss out on enthusiastic, skilled talent. Job seekers face demoralization and stagnation. By realigning agency incentives, corporate expectations, and the overall economic model around hiring fresh talent, we can create more positive cycles of workforce renewal. It will benefit graduates, employers, and the economy as a whole.
If you are a recent grad struggling with campus recruiting, we can help.
Andrea Benson, Managing Director
Andrea Benson is a Managing Director at Prospect Rock Partners. Prior to joining, Andrea spent 13 years at Bank of America across the IBD (M&A), HR (Campus Recruiting) and Tech (CIO) divisions respectively. Most recently, Andrea was the Global Head of Campus Recruiting and Operations at Morgan Stanley. She holds extensive knowledge of the global recruiting landscape and has a vast network given her tenure in the campus recruiting space. She holds a B.A. from Stonehill College, and lives in New Jersey with her husband and young son.
