Things are not as bad as they seem

ZipRecruiter just released an inaugural report on the job market outlook for new grads, and the results are in: Class of 2022 has no need to fret. Despite the scary headlines around layoffs, hiring freezes and slowdowns, the outlook is still rosy for those entering the tech job market this summer.

I sat down with the company’s chief economist, Julia Pollak, to discuss the results of the report, what tech companies can do to attract and retain new grads, and what ZipRecruiter’s data shows us about the tech talent market right now.

Here’s what first-time job seekers are looking for:

• Good pay was the No. 1 benefit cited by survey respondents as desirable in a new job.
• The second most important aspect? The ability to learn. “They want the opportunity for growth,” Pollak said.
• Given the layoffs in the news, their third priority isn’t surprising: job security. Most jobs, which are at-will, won’t give you those assurances, but new grads will gauge their odds of layoff in other ways, Pollak said. They might be more hesitant about taking jobs at new startups that haven’t proven their ability to be profitable. Instead, they’ll be looking to work for more established companies that have been earning decent profits for sustained periods, paying their shareholders a dividend and who have cash on hand to weather uncertainty.

Things are not as bad as they seem.

• Tech job postings are growing faster than job postings overall. In fact, they’re at their highest ever right now on ZipRecruiter, while job postings overall peaked in September and have since plateaued. “While the headlines we’re seeing about household name tech companies are serious and real — there are layoffs and there are rescinded offers — if you actually look at the numbers, they’re fairly small and not making a dent on the aggregate numbers,” Pollak told me.
• Pollak’s interpretation of the data is that there was such a talent shortage before this dip that the market downturn is actually an opportunity for companies with vacancies to “immediately go on LinkedIn and see the employees of Coinbase and Tesla and snap up talent.”

In short, talent competition is still fierce, and as a result, companies are offering new benefits that have completely blown Pollak away: benefits that typically aren’t being offered for new grads in their very first job.

• Over 33% of first-time hires got signing bonuses, which were once only given to 4% of U.S. workers. “That’s an enormous number,” she said, with bonuses running from $5,000 to $10,000 on average.
• What perks do new grads not care about? Retirement benefits and sick days. What do they care about? Student loan assistance and work-life balance. “They like having a job that won’t be too stressful,” she said.
• The fastest-growing work perk is surprising: paid sabbaticals, which had almost an 800% growth rate between 2019 and 2021. “When you lose your best and brightest and find it difficult to replace them” with months of open positions, employers become more prepared to tolerate extended time off, Pollak said. They’re also trying out other experiments in PTO, including up to two weeks before employees start, allowing new hires to take one to two months of vacation between jobs.