The companies that do best by new college graduates also get high marks when it comes to business achievements.
A new ranking of the 50 Best Workplaces for Recent College Graduates by our organization, the consulting firm Great Place to Work, and published by Fortune, finds that cultures that are fair about promotions, give employees a say at work, and guide new staffers on a career path are not just great for newly minted degree holders. Such workplaces also tend to reap competitive advantages, including increased collaboration and a more committed workforce.
Companies that want to become talent magnets for new graduates should find ways for these fresh faces to contribute right away, says Laura Peña, a consultant at Great Place to Work.
“It’s all about helping you discover where you can best apply your talents and what you’re most interested in,” Peña says. Companies on the list stood out for their willingness to listen to new grads’ goals, set clear expectations and provide consistent feedback on their progress. This often includes exposure to different areas of the business that might align with employees’ untapped talents. In addition, the best companies consistently lay out a concrete path to future advancement. Adds Peña, “There’s a lot more emphasis on the relationship with their managers.”
In fact, promotion practices represented the biggest difference in employee sentiment between the 50 Best Companies for Recent College Graduates and peer companies. Some 86% of employees at the leading businesses agree that “promotions go to those who best deserve them,” compared to about three-quarters of employees at peer companies. The ranking, in which we evaluated roughly 600 companies that are certified as great workplaces by Great Place to Work, also considered survey responses to questions related to training, profit-sharing, meaningful work and how welcoming organizations are, as well as companies’ rate of hiring over the past year.
Geotechnical and environmental services firm ENGEO puts employee-centric values into practice from day one. ENGEO, which ranked first on our list, connects new hires with a “go-to guy/gal” who helps navigate the new office. Soon after, they’re paired with a senior, non-supervisor mentor for further support and the chance to observe technically challenging projects. Feedback from managers (formally titled “servant leaders”) is constant; and annual reviews even touch on progress in pursuing employee’s dreams inside and outside work. As one ENGEO employee explains, “I typically meet with my servant leader once a week to discuss both work related topics and personal life topics. He will often ask me how he can help serve me better.”
This kind of environment is becoming more important for retaining the best and brightest. According to a 2015 survey by management consulting firm Accenture, 60% of new graduates were willing to trade a lower salary for a good social atmosphere at work. The 50 Best Workplaces for Recent College Graduates also reinforce how important a healthy culture can be. Compared to peers, a greater share of employees at the winning companies say their colleagues avoid politicking and backstabbing, while more than nine in ten say they enjoy a “family” or “team” feeling on the job.
If that sounds like too lofty a goal, consider this: The unemployment rate for college graduates currently sits at just 2.3%. Today’s grads are also entering the workforce more prepared than ever, with 82% in the Accenture survey saying they considered the job market before picking a major and more than seven in ten completing an internship or similar program before graduating.
These are people who’ve invested heavily in themselves, and that doesn’t stop when they leave campus. Among the tools Peña says can add value in retaining early-career talent is self-directed training. Examples include on-site libraries, self-paced video courses and virtual learning events like those at Big Four audit firm KPMG.
While new employees strive to become more valuable, the best employers also give them confidence that they’ll be rewarded fairly for their effort. People at the best workplaces are notably more likely to say they are paid fairly and receive an equitable share of their organizations’ profits. Showing new grads the money is important given the debt loads many carry. According to the Wall Street Journal, seven in 10 bachelor’s degree recipients were expected to graduate with student loans averaging $35,000 – more than twice the inflation-adjusted amount owed by students two decades ago.
Leading companies realize investing in new graduates and a positive culture overall is well worth it. Surveys conducted of the 50 Best Workplaces for Recent Graduates found teams substantially more likely to say they can count on colleagues to cooperate, as well as a greater willingness to go the extra mile to do their jobs, compared to workers at peer companies.
And there’s a bigger payoff still: today’s newcomers fresh out of college will eventually become the leaders of tomorrow’s economy.
Ed Frauenheim and Tabitha Russell are director of research and content, and recognition program manager, respectively, at Great Place to Work, the longtime research partner for Fortune’s annual list of the 100 Best Companies to Work For and other best workplaces lists, including the 50 Best Workplaces for Recent College Graduates.