As graduation season approaches, black Americans are among the college graduates likely to enter the nation’s workforce soon.
Yet, they might be faced with an unpleasant reality regarding the lucrative amount of money they hope to earn by taking on their first career job.
According to the 2022 Data: College Students Overestimate Starting Salary by $50,000 study, it was reported that the average starting salary for recent graduates is $55,260.
However, black respondents expected an average annual salary of $104,810. That’s just slightly more than the comparable expected salary for white respondents of $103,820. That means salary expectations for graduates are now roughly doubled — by almost $50,000.
The Real Estate Witch online study was made up of 1,000 individuals identified as students pursuing a bachelor’s degree surveyed in March 2022. To gain insight into their salary expectations, they were asked several questions ranging from their financial situation to the job market. work. Of those interviewed, 185 identified as black.
Future graduates will enter a job market that will rebound rapidly from the COVID-19 pandemic. “Job postings are near record highs and desperate employers are raising wages to attract top talent amid labor shortages,” the study said.
It has not been specifically identified why graduates have such a bullish earnings outlook. The new study suggested that a stronger economy may have spurred unrealistic salary expectations which could leave students ‘disappointed’. He said “students graduating in 2022 have a strong job market ahead of them, with employers expecting to hire nearly 27% more graduates” from this year’s class compared to those of 2021.
Other results revealed that among students with jobs created after graduation, only 51% are satisfied with their starting salary. Some 31% doubt they will earn enough to live comfortably after graduation. And 43% will graduate with at least $30,000 or more in student debt, 29% will graduate with $50,000 or more.
Jamie Seale, the study’s author, says the slight difference in salary expectations is possible because black respondents graduate with higher-paying degrees. “Our data shows a higher proportion of black students than the average for finance/accounting majors, and this major has above-average salary expectations after one year.”
Still, she found that black respondents expected a mid-career salary 0.5% lower than the overall respondent average of $200,270. White respondents expected a mid-career salary 1.2% above this average. “Black workers are underrepresented in leadership positions, which could explain why they expect lower salaries by mid-career.”
So what’s the downside for black graduates if their salary expectations aren’t met, and is there anything they can do about it?
Seale says black college graduates owe an average of $25,000 more in student loans than white college graduates. “If their starting salaries don’t meet expectations, it can extend the time it takes to pay off their student loans.” She added that black respondents might try to negotiate a higher salary or turn down the offer and continue to look for a better paying job.