When Katherine Ho returned for her senior year at the University of Michigan in August, she was busy with more than classwork. Within weeks the 21-year-old mechanical-engineering major had plunged into a whirlwind of on-campus job interviews with nearly a dozen companies, from Boeing (BA) to General Electric (GE) to DuPont (DD). By early September she had her first job offer -- and earlier this month she settled on another, accepting a spot at GE Aircraft Engines. Many of her friends already have offers, too. Having watched the Class of 2004 struggle to find work, Ho was plenty relieved. "It was easier to get interviews," she says. "And I was surprised there were more job openings -- it was definitely hard last year."
After three years in which many college grads found jobs scarce, the picture seems to be brightening for next spring's 1 million-plus grads. A study of 582 companies conducted by Collegiate Employment Research Institute at Michigan State University showed that companies plan to expand hiring of grads by 20% over last year; better yet, average pay could rise 4% to 7%. And the change appears to be across the board: Industries ranging from investment banking and health care to retail and real estate say they'll recruit more heavily on campus this year.
Of course, that 20% surge looks particularly good when compared with the dismal performance of recent years. College hiring last spring was up only about 5%, according to the Michigan State survey. In 2003 job growth was flat -- following a combined 50% contraction for the two previous academic years. "We're not back to the dot-com era," says Lois Meerdink, assistant dean for business-career services at University of Illinois at Urbana-Champaign. "But the trend is definitely heading up."
Why is corporate America back on campus? Forecasts for continued solid economic growth account for some of the gains; just as important, many companies can no longer continue to put off hiring for jobs left empty through attrition. Add to that the expectation that Baby Boomers will start retiring in a few years, says Phil Gardner, author of the Michigan State survey, and companies have "a human-resources gap to fill." What's more, sectors such as consulting and investment banking figure business will pick up in 2005.
Investment banks are recruiting aggressively. Goldman, Sachs & Co. (GS) plans to hire about 1,100 grads this year. That's a fraction of the level at the peak of the bull market in 2000, but it's up a fifth from last year. Like other investment banks, Goldman is moving early to get the best talent. Aaron Marcus, its director of campus recruiting for the Americas, says Goldman finished interviewing seniors in October and made most offers within a week or two of the first meeting.
It's too early for undergrads to breathe easy, though. If the economy slows in coming months, recruiters could vanish once again. Still, for Katherine Ho and many other students with jobs waiting for them, this is the best news in a while.
By Jennifer Merritt in New York