College students expect to make $103,880 after graduation – almost twice the reality
- College students expect to make about $103,880 in their first job after graduation, a new survey suggests.
- But statistics show that the average starting salary for college graduates is $55,260.
- Overestimates also persist in undergrads' outlook for mid-career earnings – while both race and gender pay gaps grow.
Today's college students expect to make about $103,880 in their first post-graduation job, a survey suggests. But the reality is much lower – as the average starting salary is actually about half that at $55,260, statistics show.
The survey, conducted by Real Estate Witch, found that, across all majors and institutions, undergraduate students overestimate their starting salaries by 88%. And 1 in 3 worry that they won't make enough money to live comfortably after graduation.
Job prospects for the class of 2022 are higher than in recent years. A report by the National Association of Colleges and Employers found that employers plan to hire 31.6% more new graduates from the class of 2022 than they hired from the class of 2021.
So far, however, Real Estate Witch's survey, conducted online with 1,000 students March 23-26, found that only 15% of students graduating in 2022 have accepted a job offer.
In NACE's salary projections from February, estimates for this year's college graduates were mixed. Most fields saw increases – with salaries for those majoring in math & sciences, and agriculture & natural resources, rising 5.4%. Meanwhile, humanities majors saw a salary decrease of 14.8% and communications majors saw a drop of 4.7%.
Computer science majors were projected to be the highest paid group, with an average salary of $75,900 in 2022, according to NACE. In contrast, estimates for humanities majors marked an average salary of $50,681.
“This is unlike what we saw last year at this time. Then, employers projected increases in all reported categories of majors at the bachelor’s degree level, and now we’re seeing some majors lose ground in terms of starting salaries,” Shawn VanDerziel, NACE executive director, said in a statement.
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Real Estate Witch found that undergrads studying journalism, psychology and liberal arts were the most likely to overestimate their future pay. Journalism students, for example, expected 139% more than the median journalist’s starting salary – projecting to make $107,040 one year after graduating while the average salary is actually $44,800.
Overestimates also persisted in undergrads' outlook for mid-career earnings. Ten years into their careers, the surveyed college students expect to make $200,270 – but, in reality, the average salary is $132,497, according to online job search and employer review site Glassdoor.
Real Estate Witch found that college women reported having lower salary expectations than their male peers over time. On average, college women today expect to earn 0.5% less than men in their first jobs – but, within 10 years of graduation, that gap widens to 4.3%.
Pay gaps also persist for college graduates of color. Real Estate Witch found that Black respondents, for example, expect mid-career salaries that are 1.7% lower than those of white respondents.
Pay gaps:In pay equity, race still stacked against women of color
Previous research suggests that, in reality, these gaps are much higher – especially when looking beyond college graduates. But among new college graduates, a NACE report from 2020, for example, found that women earn an average salary of $52,266 while men have an average salary of $64,022. And the gaps continue to grow as careers progress.
“It’s also an equity issue,” Mary Gatta, NACE’s director of research and public policy, told CNBC. "Informing students and workers can make a difference when we think about salary negotiations – it’s one way to break down systemic barriers.”
According to Real Estate Witch's survey, the top reasons students chose to attend college was to earn more money in their careers or have more career options.
Less than half of the respondents (48%) felt that college is worth the cost. 43% of respondents reported having over $30,000 in student debt, including almost 1 in 3 who will graduate with $50,000 or more in debt.
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