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Graduate labour market: Should they be worried?

It’s Labour Market week on Bdaily. Charlie Ball, deputy director of research at the Higher Education Careers Services Unit gave his views on the economy and how it has impacted the graduate jobs market.

The latest official figures reported that UK unemployment rose by 7,000 to 2.52 million between November and January, but that the overall figure held at 7.8%. For most of us it’s not really news that the economy isn’t quite stable, but what does this mean for students and graduates? Should they be worried? And is a degree still really worth it?

We’re not in a graduate jobs meltdown, but the graduate labour market remains fairly static. The latest figures show that even just six months after graduating most graduates are in jobs (62%) and just 8.6% are unemployed. To put this into perspective, even during the very worst UK graduate jobs market in 1982, 13.2% were out of work six months after graduation, but most university graduates still did get jobs.

There’s a lot of uncertainty around and businesses are recruiting cautiously, with many waiting for the latest developments in the Eurozone and for signs of a sustained economic recovery. This means that we can expect that hiring intentions will not be dissimilar to last year as businesses opt to keep graduate recruitment steady. Nobody wants to be caught without a talent pipeline if recovery comes around. The latest AGR survey suggests that large graduate employers expect a modest improvement in the state of the economy – or at least the part of it that needs graduates.

The reality for the majority of graduates this year is that their average starting salary will be about £20,000 – lower outside London and a touch above in the capital. Most new graduates will get jobs, and will not get them on large graduate training schemes, but with small businesses and local firms - both public and private sector employers. Just because these jobs aren’t with high-profile schemes doesn’t mean that they aren’t good roles with prospects.

Location-wise, since the recession, London’s share of early employment has increased and continued to rise. Scotland, by contrast, has experienced a year-on-year fall in employment share, although the overall number of jobs has held up – indeed, the Scottish graduate economy has faired better than many regions. The East of England meanwhile, has seen steady rises in the share of national employment of new graduates for the last five years. But the jobs market varies across the country and it can be hard to get jobs at all in some industries outside the capital.

London is really the only place where you can get a job in pretty much anything available to graduates, but there are a lot of good jobs elsewhere in the country. For example, the labour market in places like Manchester and Edinburgh is very diverse, but the range and volume of roles is much smaller. Graduates should speak to local careers advisers to avoid aiming for something that simply isn’t there.

In terms of sectors, construction continues to struggle. This affects quite a few graduates particularly those in engineering and architecture, which is having a particularly hard time. Media and the sciences are also not fairing particularly well. Conversely, the oil and gas jobs market is much healthier for graduates, particularly for technical specialists and those located in Aberdeen – one of the UK’s fastest growing markets for graduate jobs. Those looking to work in the City will also find themselves in a good position.

Overall, graduate recruitment isn’t what it was in 2007, but it remains healthier than you might guess from press reports. A degree doesn’t guarantee you a job – it never has in UK history – but it does give you the edge, particularly if combined with work experience.

Graduates still have to work hard to get employment, and may not get the position they want straight away. But student and graduate job seekers should not get too carried away by the news of economic instability and employment levels. They must get all the help and support they can, visit university careers services, use advice sites such as prospects.ac.uk, don’t get disheartened, and above all, continue to apply for jobs. Because, in the end, you’ll probably get a job in time, but the more resources you draw on, the quicker and easier that process will be.

For more from Labour Market Week, check out; Focus on STEM subjects will drive innovation;overcoming the UK skills gap; why recruiters need to search for the x-factor;recruitment among growing industries; Bdaily meets the labour market advisor; Adzuna’s market perceptions; the ripple affect: the need to invest in skills;the growing number of unemployed over 50s; have we got the right skills; Bdaily meets recruiter Lawrence Mallinson; UK’s jobs market: ’Power to the people“ shift; and early technology education will drive digital economy.

This was posted in Bdaily's Members' News section by Higher Education Careers Services Unit .