💸 What is the minimum salary students would accept at their first job? 💸
The minimum salary students say they’d accept at their first job is $72,580 — 30% higher than the actual average salary of $55,911.
As commencement season kicks off across the country, soon-to-be graduates are channeling their inner Jerry Maguire, beseeching employers to show them the money.
Wages are set to rise 4.6% in 2023 as employers aim to recruit and retain top talent, but widespread pay increases have caused undergrads to wildly overestimate their starting salaries.
Students expect to make $84,855 on average one year after graduation — 52% more than the average starting salary of $55,911.
Clearly, Gen Z students haven’t done their homework.
When faced with reality, though, 97% of undergrads would accept lower pay if the job came with other perks. But with student loan debt and rampant inflation, students say they can’t afford to significantly reduce their salary expectations.
Zoomers say they won’t work for less than $72,580 on average at their first job.
To learn more about students’ salary expectations, we asked 1,000 undergraduates pursuing a bachelor’s degree about their finances, job search, and college experience.
We learned that 79% of undergraduates think they deserve more money — despite receiving the highest starting salary on record.
🎓 College Student Salary Statistics
- The average starting salary for recent graduates is $55,911, but students expect to make $84,855 one year after graduation — down from $103,880 in 2022 because of widespread fears about the economy.
- More than 1 in 3 students (36%) say the average starting salary is lower than expected, and when faced with reality, one-third (34%) don’t think they’ll be able to afford basic expenses after graduation.
- 97% of students would consider lowering their salary expectations, but they wouldn’t work for less than $72,580 on average at their first job.
- 70% of students say they deserve more than the average starting salary because they work harder than their peers, and 64% say they deserve more because they are smarter than their peers.
- When searching for a job, students’ No. 1 priority is finding a job within their major, followed by an enjoyable work environment, good benefits, and a competitive salary.
- Most students (92%) who are graduating in 2023 haven’t yet accepted a job offer, but of those who have, more than 1 in 4 (27%) aren’t satisfied with their starting salary.
- Nearly 3 in 4 students (72%) think majoring in a high-demand field will guarantee them a job immediately after graduation.
- 61% of students don’t think they need to build their resume because their degree alone will be enough to impress employers.
- Another 61% of students think they won’t have to work entry-level jobs because employers will see their potential and offer them senior-level positions right away.
- Nearly 2 in 3 students (62%) think their social life in college is more important than their academic life.
- Two-thirds of students (67%) think college tuition is too expensive, and 89% will graduate with some student loan debt.
- 80% of undergrads felt obligated to attend college, but 40% regret it.
College Students Overestimate Their Starting Salaries by Nearly $30,000
In 2022, students thought they’d earn an astronomical $103,880 at their first entry-level job. High-profile layoffs and fears of an economic recession have tempered their expectations in 2023 — but their assumptions are still way out of touch with reality.
Today’s undergraduates expect to make $84,855 one year after graduation. That’s $19,000 less than last year’s assumption but nearly $30,000 more than the actual starting salary of $55,911 on average.
Students’ expectations are even more off-base when it comes to mid-career earnings. The average mid-career salary is $98,647, but zoomers anticipate making $204,560 a decade after graduation.
That figure is even more than last year’s mid-career salary expectation of $200,265.
It seems that undergrads are unrealistically confident wage growth will continue to rise rapidly in the coming decade, despite the current slowdown caused by economic concerns.
Business Students Have the Most Unrealistic Salary Expectations
Although 80% of undergraduates say they’re aware of the typical salary range for professionals in their field, 78% overestimate what they’ll make at their first entry-level job.
High salary expectations are common across all majors, but general business, psychology, liberal arts, and journalism majors are the most likely to overestimate the value of their degrees.
Of those, general business majors are the most delusional. They expect to make $98,113 one year after graduation — nearly 2x the average starting salary of $50,200. A decade after graduation, their salary expectation swells to $223,679 — 2.5x more than the typical mid-career salary of $86,600.
For the second year in a row, computer science majors have the most realistic pay expectations, overestimating the typical starting salary by just 12%.
When choosing a major, nearly 2 in 3 students (64%) say future earnings are more important than studying a subject they’re passionate about.
Yet following the money can lead to major regret among students. That is, more than half of undergrads (55%) wish they’d chosen a different course of study.
Surprisingly, engineering students express the most remorse, with 68% wishing they’d chosen a different major. Although engineers are set to receive one of the highest starting salaries, the money might not be worth the difficult coursework and high-stress environment.
Psychology majors, on the other hand, have one of the lowest starting salaries, but only 37% regret their choice of study.
Students Won’t Accept Less Than $72,580 at Their First Job
As the gradually cooling labor market requires greater flexibility among job candidates, nearly all students (97%) say they’d consider accepting lower-than-expected pay — up from 88% in 2022.
Yet students would only compromise their salary if they received other workplace perks, such as:
- A good work-life balance (48%)
- Great benefits (43%)
- Flexible hours (41%)
- A job related to their major (40%)
- A job in a desirable location (40%)
Even in exchange for great benefits, zoomers won’t work for just any amount. The minimum salary students would accept at their first job is $72,580 on average.
That’s still $16,669 more than the average starting salary, but after watching older generations work hard and still struggle financially, Gen Z feels justified asking for bigger paychecks to afford the lifestyles they want.
Education and nursing majors are the least likely to compromise on their salary expectations. With those professionals in high demand, recent graduates will have leverage to negotiate higher pay.
Although their average starting salary is just $44,100, future educators say they won’t accept less than $69,113 — just 11% less than their expected salary. Meanwhile, nursing students are set to make $65,000 at their first job, but they won’t work for less than $85,000 — 9% less than their expected salary.
Computer science students, on the other hand, are the most likely to sell themselves short. The minimum amount they’ll accept is $67,923, which is 19% lower than their expected salary and 10% lower than the actual starting salary for degree holders in that field.
Undergrads may be willing to accept less than their desired amount at their first job, but 78% say they’d keep job searching if their starting salary didn’t meet their expectations.
Nearly 80% of Students Think They Deserve More Money Than Average
When we spilled the tea on entry-level pay, the harsh reality came as a shock to Gen Z. More than 1 in 3 students (36%) say the average starting salary of $55,911 is lower than expected.
When faced with reality, one-third of students (34%) don’t think they’ll be able to afford basic expenses after graduation.
Students also worry a low starting salary will:
- Make them work a second job (37%)
- Prevent them from paying off student loans (33%)
- Cause them to take on credit card debt (27%)
- Force them to move back in with their parents (19%)
As the cost of living rises, nearly 8 in 10 students (79%) think they deserve more than the average starting salary.
About 70% of undergraduates say they deserve more money because they work harder than their peers, and 64% say they deserve more because they are smarter than their peers.
Students Prioritize Finding a Job Within Their Major Over Salary
Students are willing to compromise their salary expectations because it’s, surprisingly, not students’ top priority when searching for a job.
Instead, their main concern is finding a job within their major. About 12% of undergraduates say it’s their No. 1 priority, compared to 10% who say a competitive salary is most important.
On average, college students rank the following in order of most to least important:
|Overall Rank||Job Priorities|
|1||Job within their major|
|2||Enjoyable work environment|
|5||Job that meets their professional goals|
|6||Company that matches their personal values|
|8||Job in a desirable city|
|9||Lots of paid time off|
|10||Remote work options|
Finding a job related to their major is important to students who want to find work that aligns with their passion and talent.
Although nearly all students (92%) are confident they’ll find a job within their major, research shows only 46% actually work in their field of study.
6 in 10 Students Think They Won’t Ever Have to Work Entry-Level Jobs
Despite negative sentiment surrounding the economy, 75% of students think it’s still a good time to find a job, and 53% are optimistic the labor market will improve even more by the time they graduate.
However, among students who plan to graduate and join the workforce in 2023, just 8% have a job lined up. Of those, more than 1 in 4 (27%) aren’t satisfied with their starting salary.
The vast majority of graduating students haven’t accepted a job offer, but they aren’t dismayed by their prospects. A whopping 79% expect to have a job before they graduate.
Overall, almost half of students (46%) say the job search is progressing easier than they expected, and 61% say other people exaggerate how difficult it is to find a job.
Gen Z is fortunate to graduate into a booming labor market, with employers planning to hire 14% more new college graduates in 2023 than they did in 2022. Jobs are so plentiful, zoomers are forced to admit they have an easier time finding jobs than:
- Students who graduated during the Great Recession (50%)
- Students who graduated in 2020 (58%)
- Millennials when they graduated (62%)
College grads should be excited about their job prospects, but the strength of the labor market may lead to assumptions that are as unrealistic as their salary expectations.
For instance, it takes 21-80 applications on average to receive one job offer, but about 77% of students think they’ll have multiple competing job offers upon graduation.
Another three-fourths (72%) think majoring in a high-demand field will guarantee them a job after they graduate, even though employers are starting to emphasize skills over degrees when hiring.
What’s more, 61% of undergrads believe they won’t have to work entry-level jobs because employers will see their potential and immediately offer them senior-level positions. If that doesn’t happen, students aren’t worried. About 76% think they’ll be promoted within the first year at their company — about two years earlier than average.
An additional 61% say they don’t need to worry about building their resume because their degree alone will impress employers.
Who needs an impressive resume anyway when more than 2 in 3 undergrads (68%) say their personal and family connections will help them get a job after they graduate? That could be why 62% of students say their social life in college is more important than their academic life.
40% of Students Regret Attending College
Social norms dictate that students attend college, even if it’s not the best choice for their career path. In fact, 80% of currently enrolled undergrads felt obligated to attend college — but 40% regret their decision.
One of the most common causes of regret is borrowing money to pay for their education, and 61% of undergrads wish they’d chosen a less expensive college.
Student loan debt is a ubiquitous problem, with 89% of college students graduating with at least some debt. The average borrower owes about $30,000 in student loans, but nearly 1 in 4 of our survey respondents (23%) expect to graduate with more than that amount.
The standard loan repayment plan is structured to last 10 years, but with students expecting to make more than the average starting salary, 94% don’t think it will take that long. About half of students (52%) say they can repay their debt in less than five years, but in practice, it takes borrowers close to 20 years to pay off student loans.
As that debt burden follows students into adulthood, some are forced to delay major life events, such as buying a home or having kids. It’s no wonder 69% of students think a college education should be free, and 63% think student loans should be forgiven.
Overall, two-thirds of students (67%) think college tuition is too expensive. More than half of undergrads (55%) have worked a part-time job to fund their education, diverting time that could otherwise be spent at a study group, internship, or student organization.
To support themselves financially, students have also:
- Taken out a personal loan (22%)
- Taken on credit card debt (18%)
- Taken on more student loan debt than expected (18%)
Other students have pursued less traditional ways to make money. About 1 in 25 students (4%) have sold some type of drug, such as marijuana or Adderall, and 1 in 11 (9%) say they have worked in adult entertainment.
Three-Fourths of Students Think College Prepares Them for the Workforce
Young adults may question if college is worth the cost, but among currently enrolled students, 77% say it does make them feel prepared for the workforce.
College campuses have professional advisors, career centers, job fairs, resume workshops, and mock interviews to help students stand out in the job market.
More than three-fourths of students (77%) have visited their college career center, and of those, 85% say it has helped them get a job or prepared them for the workforce after graduation.
The proprietary data featured in this study comes from an online survey commissioned by Real Estate Witch. One thousand American undergraduates pursuing a bachelor’s degree were surveyed March 23-25, 2023. Each respondent answered up to 21 questions related to their career expectations, financial situation, college experience, and the job market.
About Real Estate Witch
You shouldn’t need a crystal ball or magical powers to understand real estate. Since 2016, Real Estate Witch has demystified real estate through in-depth guides, honest company reviews, and data-driven research. In 2020, Real Estate Witch was acquired by Clever Real Estate, a free agent-matching service that has helped consumers save more than $160 million on realtor fees. Real Estate Witch’s research has been featured in CNBC, Yahoo! Finance, Chicago Tribune, Black Enterprise, and more.
More Research From Real Estate Witch
2022 Data: College Students Overestimate Starting Salary by $50,000: Learn how students’ salary assumptions have changed from 2022 as widespread fears about the economy temper their expectations.
1 in 3 Employees Are Quiet Quitting Their Jobs: Recent graduates who are unhappy with their starting salary may resort to quiet quitting. Find out how they can be reengaged.
Bad Bosses Are Destroying Employee Happiness: Students will prioritize finding an enjoyable work environment over a competitive salary. Discover what employees want in a workplace.
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What is the average starting salary out of college?
The average starting salary for recent college graduates is $55,911, but students expect to make $84,855 one year after graduation, and they wouldn't work for less than $72,580 at their first job. Learn more.
What is the average starting salary for college graduates by major?
Students across all majors overestimate their starting salaries, but general business majors are the most delusional. They expect to make $98,113 one year after graduation — nearly 2x the starting salary of $50,200 for degree holders. Learn more.
Is college worth it?
Research has shown that bachelor's degree holders earn 75% more than those with a high school diploma, but 40% of students still regret attending college. Learn more.