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Dan Loney: Well, we are at the time of
college graduation, and so that means an influx of new people
into the workforce full time.
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But with a labor market that's
still holding its own, companies are concerned obviously around
tariffs and consumer spending in
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the months ahead. What should
graduates expect? Pleasure to be joined by Matthew Bidwell,
Professor of Management here at
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the Wharton School. Hi Matthew, great talk again.
Matthew Bidwell: Hi Dan, nice to
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see you again. - So I guess we're
at a point round with these graduations occurring, many
graduates may already have a
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job, so they're fairly set. For
those that are still searching, what's the landscape look like?
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- I'm sorry to say it's not great. There are, I think, slightly
weird things going on in the
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market for college graduates. And
so, you're right, when you look at the labor market overall,
unemployment is not that far off
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historic lows. It's still, the
labor market overall, people have jobs, but unemployment for
college graduates has been
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trending up for about three or
four years now, and it's higher than it's been since
about 2015. And so, yeah,
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it's not catastrophic, but it's
not what it has been. I mean, it's not as positive a picture
as I would like to paint.
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- What do you think is driving it? - All sorts of things. I think
there's one thing that's fairly
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straightforward, one thing
that's a bit weirder. The straightforward piece is, as you
said, the labor market's kind of
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good, but there are a lot of
headwinds, and so it's a little bit frozen. And so you're seeing
this -- what you're seeing is most
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people have jobs, which is
great. There's not a lot of firing going on, also great. But
there's not a lot of quitting,
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and there's not a lot of hiring.
And so I think, given all the uncertainty that we're seeing,
employers are doing what I think
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is exactly the right thing, I
wish they did more regularly, which is to be slow about firing
and slow about hiring. I think
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they're kind of seeing it's
like, you know, to fire people today and then try and rehire
them in a few months time is
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incredibly expensive, and let's
not do that. So they're not letting go of people. But
they're also saying, "Because we
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don't want to have to do that,
we're pretty nervous about taking on new people." And so the
rates of hiring are much lower
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than they have been recently,
which, you know, again, if like you, like me, you're in a job,
that's not a big concern. But if
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you're a college graduate and
you're looking for a job for the first time, you're one of the
groups that's really going to be
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hit there. - So what potentially leads to
then shaking loose some of those people, maybe saying, "Look, it's
time for me to move. I'm going
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to go to a new company." Because
I think a lot of people feel like they need to have the
security right now.
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- Yeah, I mean, if you look at why
there's not so much quitting going on, I think it's
largely related to there's not
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much hiring going on. So
companies are being very cautious. People who are in jobs,
that makes it harder for them to
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move. They're maybe not kind of
exiting some of these entry level positions and creating
room for college graduates. And
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so the whole thing is slightly
in stasis while everybody tries to figure out what's going to
happen next. - How
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much then, if somebody is able
to procure a couple of offers for a new job, in terms of
understanding and really
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researching which is the best
option for them, taking the time and thinking about that best
option? - They absolutely
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should. I mean, there's a tricky
dilemma here, which is, you know, when you know the job
market is not as good as it has
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been, certainly you want to
search harder, but maybe you want to settle for something
that maybe, if you've been
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looking two years ago, three
years ago, you wouldn't have settled for, because kind of that
great job may not be out there
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anymore. On the other hand, kind
of the job that you take does have implications for what you
learn and where you go to next.
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And so one of the unfortunate
things that we've seen from prior research is that people
who graduate in recessions where
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it's really hard to get a job
tend to see these kind of lasting penalty, because you end
up being hired into lower paying
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jobs, and the experience you're
getting is not so good, and so on. So I think, you know, it's you
need to balance being realistic
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with trying hard to get a good
job. And I do think to the extent to which people find they
end up in jobs that are a little
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bit disappointing for them, being
prepared to move. So, like I say, the labor market is a little
frozen at the moment. It
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could unfreeze, it could get
worse. It will not stay frozen forever certainly. And so I
anticipate, certainly, two,
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three years we expect things
to be better. And so I think if people do end up in jobs that
they find they can't get the
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right job for them, being
prepared to try really hard to move subsequently, and kind of
doing what it takes to move up
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I think is important to get
their career back on track. - Is the expectation then
of getting a job offer and
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having it have some component of
remote work, is that going away a little bit, or is that still
in the mix a good bit? - It's
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still in the mix. You know, if you
read the news, there's no such thing as remote and hybrid work
anymore. You know, I speak to
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more and more people whose
companies are dragging them back in. If you actually look at the
survey data and other things, it
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hasn't changed that much over
the last two years. There's a lot of hybrid work, there's a
lot of remote work. And I
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suspect, frankly, for a lot of
fresh college graduates, you know, small companies, young
companies, they don't want to
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pay for offices. I would also
say it's a double edged sword for college graduates. And we've
talked about this before. I'm a
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fan of remote hybrid work. It's like,
let people work where they want to. But I think if you are a
fresh college graduate, there's
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a lot to be said for being
around other people. Partly, it's fun. It's a time in your life
you want to be around other
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people. But particularly, it's
easier to learn that way. And so I actually think if I was coming
out of college, I would really
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be putting a premium on
experiences where I could actually be in an office around
other people and get a better
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chance to figure out what's
going on. - Matthew, always great to talk.
Thanks very much. - Good to speak
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with you. - Thank you. Matthew
Bidwell, Professor of Management here at the Wharton School,