San Jose leads nation in hiring new college grads

San Jose ranked No. 1 on a national list for hiring the most new college graduates. But students shouldn’t toss their caps in the air just yet.

The San Jose metro area, which includes the cities of San Jose, Sunnyvale and Santa Clara, hired the highest number of new graduates last year, outpacing other major U.S. metro areas, according to a May report by Gusto, a payroll and HR software company. Yet while some new graduates can look to a six-figure salary, they’ll still have to contend with an overall cooling job market and Silicon Valley’s steep cost of living.

The study found that San Jose had the highest increase in new graduate hiring on average at 9.6% from April 2022-23, ahead of other major cities like Houston at 8.5%, New York City at 8.0% and Miami at 7.9%. The report found that while San Jose was the sole area nationally to offer new grads a six-figure salary at an average of $102,839, that number plummeted to an average salary of $57,580 when adjusted for living expenses.

San Jose State University Associate Director of Career Education Anita Manuel said the city’s high cost of living comes at no surprise to the region’s graduates. She said the area is rich in universities graduating students who are willing to work in and around San Jose, so tackling the high cost of living needs to be a priority for local leaders.

“If you look at historical trends, Silicon Valley always comes out on top,” Manuel told San José Spotlight. “If government or society wants to improve anything, it would be on those infrastructure things: affordable housing, supportive transportation if people want to commute… Those are the things that are going to help keep our talent here.”

Despite recent tech layoffs dominating the headlines, Gusto economist and study author Luke Pardue said smaller tech companies are actively looking to hire graduates.

The report found that May 2023 hiring for 20-24 year olds is at 5.4%, which is still significantly lower compared to 7.2% this time last year. But there are upticks in hiring across industries like retail, with the study pointing to nontraditional jobs such as e-commerce roles in food businesses on the rise. In San Jose, tech still reigns supreme as the leading industry for new graduates.

“Even if overall we’re seeing this growth in personal services and retail and food and beverage, we actually are seeing a lot of growth in software and tech in San Jose,” Pardue told San José Spotlight.

SJSU Assistant Director of Employer Engagement Lisa Trikofski said the university is seeing an increase in employers looking to hire, especially in education and local government. The city of San Jose reported hundreds of job vacancies, an issue throughout Santa Clara County. Meanwhile, local school districts are working tirelessly to hire hundreds of teachers who have left the expensive Bay Area.

Latina Coalition of Silicon Valley executive director Gabriela Chavez-Lopez said while robust hiring isn’t surprising given San Jose’s diverse array of industries, students of color need additional advocacy and support to obtain better, higher-paying opportunities to keep them in the city. The nonprofit provides career development through its Latina Economic Advancement Program.

“Particularly around new grads of color, they aren’t as much tied into really supportive social networks of professionals that they can lean in on,” Chavez-Lopez told San José Spotlight.

Pardue said local leaders should keep an eye on new graduate hiring rates, especially since these workers contribute heavily to the economy now and in the future.

“Attracting this pool of talent sets the city up for a foundation of success down the line,” he said. “They create new ideas that raise productivity, and they also often go on to form their own businesses which create new jobs. They form the first part of this cycle of growth for a city.”

Contact Loan-Anh Pham at [email protected] or follow @theLoanAnhLede on Twitter.