New Data Shows That Nearly Half of Young Entry-Level Workers Without College Degrees Struggle to Progress to Better-Paying Jobs Within Five Years

SEATTLE, WA (February 10, 2021) – Burning Glass Technologies, with support from the Schultz Family Foundation, today released Entry-Level Work as a Stepping Stone, Not an End Point, a report examining the work histories of young people aged 16 to 24 not in school, without college degrees, and lacking work experience. Based on an analysis of resumes of entry-level workers at 53 companies, it found that after five years, 48% of young workers remained in a dead-end cycle of entry-level jobs.

Burning Glass found significant differences in advancement rates of entry-level workers across the 53 companies. In some companies, many entry-level workers advanced into better-paying jobs in the first five years, building off of their experience at those initial employers. But in half of the companies studied, the majority of young workers were stuck or “spinning wheels.” While these workers did change jobs during the five-year period, they tended to stay in the same occupation or move to one that was typically lower-paying.

The young people who are “spinning wheels” are likely to go on to be what the Brooking Institute has deemed perennial low-wage workers, the 53 million Americans aged 18-64 that earn median hourly wages of $10.22 and median annual earnings of $17,950, without a clear path to higher wages. In fact, of the companies surveyed, the report found that nearly two-thirds of entry-level positions were held by workers who had accrued more than seven years of work experience.

“First jobs can be a valuable first step towards a fulfilling career path. Employers should encourage the employment and professional growth of young, entry-level workers,” said Tyra A. Mariani, president of the Schultz Family Foundation. “This is an essential component in closing the opportunity gap and advancing equity, all the more important during a public health and economic crisis that has disproportionately impacted those with the fewest resources.”

“The fact that more than half of young people without college degrees advance into living wage jobs is testament to their talent, drive and perseverance” said Matt Sigelman, CEO of Burning Glass Technologies. “Given the chance, these young workers can and do succeed. Imagine the level of success that could be achieved with greater employer and community supports and a focus on the skills that can drive their advancement.”

These findings are based on analysis of more than 50 million resumes to quantify the patterns of hiring and advancement of young workers with limited education and work experience at employer partners in 100,000 Opportunities Initiative (now called the Hire Opportunity Coalition). Burning Glass identified approximately 30,000 resumes of such workers hired into entry-level positions at coalition employers since the Initiative launched in 2015, and over 100,000 of such resumes spanning the last decade.

Key findings from the report include:

• The data reveals three major patterns of career progression. In an analysis that studies where new hires land five years after their first job, the experience of young employees with limited work and education backgrounds presents three quite distinct profiles:
• Leapfrogging – 44% of young workers in this cohort showed progression from their entry-level job, most moving into better-paying jobs in other career areas.
• Levelling Up – 8% of the studied young workers progress to better-paying jobs within the career area of their initial entry-level role.
• Spinning Wheels – 48% of the young workers in the database appear to be stuck, with fewer than half earning a living wage after five years working.
• Among the firms studied, young workers with limited education and employment history cluster in four main career areas. Nine in 10 of these workers get their start in sales, administrative support, food service, and transportation.
• Many young workers who begin with limited work experience and education advance to better-paying jobs and earn a living wage. Just over half of such young people hired into entry-level work at the companies studied advance from entry-level to better-paying jobs in the first five years— not necessarily at the same employer or even in the same industry, but over the course of their employment. Further, after these five years, 63% of these young workers are in occupations paying a living wage, up from 39% in their initial job. The resume data does not indicate individuals’ racial identity, but disparate experiences of racial and ethnic minorities in other areas (rates of disconnection, wage levels, etc.) indicate that those individuals generally face greater challenges in entry-level employment, and likely face similar disparities in advancement.
• The average tenure listed on the professional resumes of young people with limited educational and work experience who got their start at 100K employers was 17 months. While job retention is important for both the employee and the employer, it is not clear whether these workers are experiencing greater benefit from retention, or whether they have stagnated in their career experience and are missing out on opportunities for advancement into better jobs with better wages and schedules.
• There are a variety of jobs that young workers with limited education and work experience tend to take when they advance. When these young workers transition out of entry-level work, they do so most frequently by taking on roles as managers or supervisors; some also transition to jobs as computer user support specialists, nursing assistants, and office clerks – all roles that may become more accessible by virtue of them developing work habits and career experiences generally, but that are outside of the industries and career areas that characterize their first jobs.

Substantial, career-altering benefits can accrue to young workers with limited educational or work experience who begin as entry-level workers, but those benefits are by no-means assured. The experiences of those who Leapfrog and Level Up offers hope to workers and can encourage employers and sectors who employ large numbers of these workers to make these positive outcomes more common, with benefits for workers, their families, and the economy as a whole. As the U.S. navigates recovery from the COVID-19 crisis and its economic outcomes, society can ill-afford to let young people’s economic uncertainty deepen further. Rather, at this time of reimagining how best to drive recovery, it is critical to fully reimagine entry-level work as a stepping-stone rather than a trap, and to ensure all workers can use these early work experiences to launch successful, meaningful working lives.

As the post COVID-19 economic recovery takes shape and employers face new realities, they can use this unique moment to reevaluate and redesign hiring and employee development in a way that helps their bottom line and allows the benefits of economic recovery to be shared more broadly than prior to the crisis. By intentionally employing, developing, and promoting opportunity youth and others who have been disproportionately impacted by the dual health and economic crises, employers can not only better engage, retain, and nurture talent, but also facilitate opportunity to those with the fewest resources and drive recovery that is equitable and enhances social mobility.

The full report is available here. Entry-Level Work as a Stepping Stone, Not an End Point was made possible through the support of the Schultz Family Foundation

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About Burning Glass Technologies

Burning Glass Technologies delivers job market analytics that empower employers, workers, and educators to make data-driven decisions. The company’s artificial intelligence technology analyzes hundreds of millions of job postings and real-life career transitions to provide insight into labor market patterns. This real-time strategic intelligence offers crucial insights, such as which jobs are most in demand, the specific skills employers need, and the career directions that offer the highest potential for workers. burning-glass.com.

About the Schultz Family Foundation

The Schultz Family Foundation, established in 1996 by Howard and Sheri Schultz, creates pathways of opportunity for populations facing barriers to success, including youth and post-9/11 veterans. The Foundation invests in innovative solutions and partnerships that unlock people’s potential, and strengthen our businesses, our communities, and our nation. For more information about the Foundation and its work: schultzfamilyfoundation.org.

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