Why entry-level jobs are vanishing

As anyone who’s graduated from university or applied for their first job in recent years can attest to, something new – and alarming – has happened to entry-level jobs: they’ve disappeared.

A recent analysis of close to 4 million jobs posted on LinkedIn since late 2017 showed that 35% of postings for “entry-level” positions asked for years of prior relevant work experience.

That requirement was even more common in certain industries. More than 60% of listings for entry-level software and IT Services jobs, for instance, required three or more years of experience. In short, it seems entry-level jobs aren’t for people just entering the workforce at all.

And while that first job is harder than ever to get, it’s also more important than ever, says Alan Seals, an associate professor of economics at Auburn University, US. It may be the bottom-most rung on the employment ladder, but a worker’s first position sets the tone for their career.

“The most important time in your career is the first three years,” he says. “The quality of your first employer really matters. So, how do you get that first job?”

The simple answer is workers need something more than motivation or a college degree to enter the workforce now, whether it’s lots of internships, or the connections to get around a complex application process without an algorithm weeding them out. But not everybody has access to those advantages, and the result is that workers are being left behind.

The rise of the internship

An ever-growing internship market means more young people are fleshing out their resumes before they even leave university, says Seals, who notes many students are now getting their first internship after first year.

“Internships are now the entry-level,” he says. “Most of the students in college are doing or trying to do internships, and now it’s increasingly common to do more than one.”

Internships are now the entry-level – Alan Seals

Seales says this fact impacts the entry-level job market on multiple fronts. First, companies can save money by using interns to do that work without having to pay junior employees; the more interns a company has, the fewer entry-level jobs it’s likely to open.

Second, because applicants with one or more internships on their resume aren’t tough to come by, those who don’t have internship experience are left out in the cold. That can happen to students who can’t afford an unpaid or low-paid internship, or those who have trouble securing one.

“In some cases, you need to have had an internship to get an internship. It’s also tough if you’re an ethnic minority,” says Seals. A February 2020 study he co-authored showed that employers are “less likely to respond to [intern] applicants with Black-sounding names” and much more likely to hire those who’ve had internships before.

Add to that the fact that the vast majority of internship opportunities are geographically located near major cities, meaning those who don’t already live there or can’t relocate are out of luck.

“This is a problem – in the United States, the internships are on the coasts,” says Seals. “Those are the most expensive places in the country to live. If you’re in college in a region with no internships, now you need to not only get an internship, but find a way to afford moving there for a summer. If you have no knowledge of how the system works or how to gain access to these elite levels and places, you’re left behind.”

The automated office

It’s not only internships that have replaced the entry level job. Many of them have been eliminated over recent decades as tools and technologies are introduced to do the same work – without the paycheck.

“A lot of what would have been classified as entry-level 30 years ago has gone away because of automation,” says Scott Dettman, CEO of Avenica, a US-based career-matchmaking service for new graduates. “Think about things like product research, scheduling or ordering office supplies. Creating presentations – there used to be whole teams that did that. Now we have Microsoft PowerPoint.” Work that once fell to a group of early-career employees can be done by one person, in a fraction of the time. “It’s a huge optimisation increase – we can do a lot more with a lot less,” says Dettman. “But it’s also taken a lot of those roles that were more administrative in nature.”

What’s left at the “entry level”, then, are often jobs that require more interpersonal communication, higher-level responsibilities or consumer-facing roles, which many companies are reluctant to trust to a newly-minted graduate.

“The roles that exist now are in customer service, claims management, project management, those kinds of things,” says Dettman. “But there’s a different level of rigour to that work, and some industry knowledge that goes into those things. Increasingly, people have gotten almost skittish hiring right out of school. I’ll talk to executives who are like, ‘we’re happy to hire entry-level people… as long as they have two years of experience’.’”

The job application and hiring system has also been automated, which only makes things more difficult for entry-level workers who may be a good fit for a role, but who lack the right resume buzzwords.

“There are major problems with the hiring processes,” says Dettman. “We’ve made it so that applicants will hit ‘easy apply’ and apply for 200 jobs in an hour. It’s flooding these talent acquisition teams with so many applicants that they’re basically forced to rely on algorithms to weed out candidates. So, they start to look for key terms, key skills, key identifiers.”

In some cases, you need to have had an internship to get an internship – Alan Seals
Right off the bat, this puts people with fewer or no internships, or a degree in a less-related major or from a less-reputable school, at a disadvantage. Plus, there’s only a slim chance the average college graduate’s resume will include all the skills and experience required by a given job.

“Employers are unhappy with the level of talent they’re getting in the entry-level space,” says Dettman. “So, instead of trying to take corrective action, they’ve increased experience requirements. In the last five years, we’ve seen a 20% increase in the number of skills required on job listings.”

The flawed system

All of this adds up to an incredibly tough entry-level job market. And the inability to land a solid role in a worker’s desired field right out of college can impact their careers in a major way, for a long time.

“The data and the statistics definitely bear it out; 43% of college graduates don’t have a college-level job in their first job after school,” says Dettman. “The same study suggested that about two-thirds of those people are underemployed for the next five years.”

The wage gap between people working a college-level job and those who end up in a role that doesn’t make use of their degree is about 22%, adds Dettman. “That’s well over $100,000 in lost earnings in the first decade of employment.”

This perpetuates economic inequality, as it disproportionately affects people who didn’t – or couldn’t afford to – have internships. It also, ironically, can keep people who had to work a minimum wage or service job while in school from getting a position related to their major once they graduate.

“Being from the lower class can be an obstacle,” says Seals. “We found that having a job on campus, in food service or whatever, seems to harm you. I think it signals class, which is part of the reason we’ve got inequality issues and a lot of people are shut out from entry-level employment.”

Finding a workaround

It’s a deeply flawed system, says Seals, but until it changes, there are ways to work around it.

“If you get out of college, can’t get a job in your field right away, and go work at a restaurant or at Starbucks or something, do not put that on your resume,” says Seals. His research suggests listing a service or retail job can be detrimental when applying for other work.

When it comes to “hacking the algorithm” of an automated job search system, Dettman says sometimes the best way to get through is to go around.

There’s reason to be optimistic that, in the aftermath of the pandemic, the system is undergoing a shift
“Find people who do that job today, and engage them,” he says. “Every company will interview people who are referred by internal employees, especially if those people do similar jobs. The best way to break in is to go around the automated pipeline. Ask if they can put your resume in front of a hiring manager, who will likely then actually review it.”

There’s reason to be optimistic that, in the aftermath of the pandemic, the system is undergoing a shift. Jobs replaced by PowerPoint aren’t coming back, but the increasing ubiquity of remote work means more access to internships and a hiring pool expanding outside major metropolises. And the pandemic has – and continues to – shake up requirements and pay for entry-level jobs as well as how many of them actually exist. So, there are more changes to come.

Still, says Dettman, keeping vast swaths of qualified workers from becoming under-employed will require a bigger paradigm shift. That may mean moving away from one-size-fits-all systems for sorting job applicants, reevaluating what skills a job really requires and broadening the definition of relevant experience.

“I’m not anti-algorithm,” he says, “but when we have poorly-written job descriptions and resumes that don’t tell the whole story, we have incomplete data.” Better hiring practices, he suggests, might focus on an individual’s accomplishments, characteristics and potential, rather than just the number of years of prior experience or technical skills on their resume.

“Rebuilding entry-level jobs and getting people hired means getting away from the resume and changing the conversation to: who is this person really?”