Why are there so few jobs for graduates?

Graduate vacancies have fallen to a record low as employers cut back on junior hiring, amid rising costs and economic uncertainty

The number of advertised graduate roles fell to 8,383 in July, down 45.6 per cent year on year, according to the latestUK Job Market Reportfrom job matching platform Adzuna. 

This follows a sustained drop in graduate opportunities, which have declined from a peak of more than 55,000 in mid-2017. 

UK economy losing £26bn a year to youth unemployment, PwC research finds

Young workers fear poor health could cut careers short, study finds

One in eight young people out of work and education, ONS figures show

RecentPeople Managementreporting on Deloitte dataindicated that cost issues could be a factor, as it found 62 per cent of finance leaders had cut graduate hiring and 64 per cent expected further reductions

Jack Kennedy, senior economist at Indeed, says it is common to see employers “pulling back hardest” onjunior hiring during economic uncertainty

But are opportunities truly declining as much as the figures indicate, and what impact will this have on talent pipelines?

The outlook for university leavers

The decline comes amid wider concerns about young people’s ability to enter the labour market; the number of university graduates who are jobless and claiming benefits has risen by 46 per cent since 2019

Around707,000 graduates were out of work and receiving government support in January, according to analysis by think tank The Centre for Social Justice. 

And, in May,former health secretary Alan Milburn warned of a potential “lost generation”, as his interim review of youth unemployment found the number of young people out of work could rise to more than 1.25 million within five years without government intervention

Kennedy also warns that a delayed career start can lead to issues that compound over time. “Graduating into a weak labour market can leave a mark on earnings and progression that outlasts the job search itself, sometimes by years,” he says

There could also be longer-term consequences for businesses if they fail to recruit enough junior workers now. “If weak graduate hiring persists, further down the line businesses are likely to find themselves facing a smaller pool of mid-career workers to draw from,” Kennedy adds

Are graduate job opportunities really declining?

However, experts caution that Adzuna’s figures do not capture every job available to graduates. Stephen Isherwood, joint CEO at the Institute of Student Employers, says jobs advertised as ‘graduate vacancies’ are not the same as the total number of opportunities available. 

“Graduates compete for a much wider range of entry-level and professional roles, while employers do not necessarily advertise every graduate opportunity as a ‘graduate vacancy’,” he explains

Employers may also be advertising fewer roles because they receive a high number of applicants or are recruiting through other platforms, such as LinkedIn

Dan Hawes, co-founder of the Graduate Recruitment Bureau, agrees that employers often don’t need to advertise on job boards as they receive such a high volume of applications and often hire interns or placement students. 

“The definition of a graduate job also needs clarity as many entry-level roles don’t necessarily contain ‘graduate’ in the title, plus there are many graduates in temporary or part-time roles,” he adds. 

Rebecca Siciliano, managing director of Tiger Recruitment, says the situation is “not as bleak for young people” as the figures suggest. 

“This is really a graduate scheme problem, not a junior roles problem. Entry-level admin and business support is a totally different picture. Demand hasn’t moved, the way in has just changed,” she explains

What can businesses do to help? 

Kennedy advises organisations not to rely too heavily on previous job experience when recruiting for graduate and entry-level roles. 

“Assessing candidates’ potential and transferable skills would give more young people the chance to get started, while helping businesses develop the talent they will need in the future. This mindset shift from immediate cost to long-term talent pipeline is essential to ensuring young people find career opportunities,” he says. 

Kennedy urges the government to improve access to apprenticeships, vocational training and targeted support for young jobseekers. 

“The key is to create more routes into work, not treat a university degree as the only path,” he says.  

Ultimately, Kennedy adds, a sustained recovery in graduate recruitment would depend on greater business confidence and easing of cost pressures. 

Milburn’s final report on youth unemployment, due in September, will set out recommendations for government and employers. 

For more information, readthe CIPD’s report on tackling youth unemployment

---

Source: www.peoplemanagement.co.uk