Stephen Isherwood, joint CEO of the Institute of Student Employers (ISE), considers what themes might dominate the graduate recruitment market in the year ahead
A positive but uncertain jobs market
Overall, the graduate jobs market is growing. ISE employers expect to increase student hiring by 5% this year.1 The market is difficult to predict as not all sectors are set to grow and individual employers, specific business units within organisations, may cut back on hiring.
So I'd expect public sector roles, professional services roles with qualifications attached, and apprentice vacancies to hold firm. More cyclical business sectors such as consulting, retail and construction may see vacancy cuts. Many tech firms expanded their workforces as the pandemic eased, but have since contracted as consumer behaviour shifted back to pre-pandemic norms.
The graduate jobs market is always tough with more students applying for programme roles than there are places, and they may find competition for jobs more intense in 2024. Our advice to students: avoid any negative headlines and don't be put off applying for jobs - after all, even in the depths of the pandemic over 80% of student hiring continued as normal.
Student mental health
That student mental health declined in the pandemic and remains at concerning levels is not news. The cost of living crisis has only made life difficult for even more students. Students' challenges do not end as they graduate and enter work.
In last year's ISE Development Survey, 64% of employers said they'd seen an increase in the number of student hires seeking help with mental health issues.2 And nearly a third said that their graduate hires had lower levels of resilience than they expected. The overwhelming majority of ISE employer members (85%) now provide dedicated mental health support and counselling to early career hires.
Employers and universities already play a key role in preparing students for the transition through education and into work. I'd like to think that as well as collaborating on skills development, we can collaborate to help students understand the workplace and prepare for the inevitable pressures they'll face, as well as increasing levels of pre-joining support.
AI in recruitment matures
Cast our minds back a year and AI was the New Year's news. Students using AI in their studies grabbed the early headlines, but then employers started thinking about how students might use the new tools to fill in application forms and complete online assessment exercises.
Despite concerns about AI's impact on assessment validity, we have yet to see a major change in the methods employers use to recruit students. Recruitment systems take time to develop and validate, which is why much output to date has focused on employer advice to students about how to use - or not use - AI when applying for jobs.
AI could well transform how students apply to jobs and are assessed by employers. AI will definitely impact the nature of many graduate jobs. As student use of AI becomes better understood, and as more employers implement new processes, we should be better able to advise students on how to make the best use of AI in their job searches as the year progresses.
Many employers are considering how AI is changing their early careers recruitment, including implementing new selection approaches and tools at the start of a recruitment season.3 Expect a widespread roll-out of new assessment processes this coming autumn.
The politics of visas
Will the political immigration debate lead to tighter regulations on international student and employment visas? At the time of writing, we don't know where the government will set the salary level for new entrants using the skilled worker visa. This is important for employers, particularly ISE members who recruit international students, because they are more likely to use the skilled worker visa over the graduate visa as they want security of employment for their hires.
So the announcement before Christmas from the Home Secretary, James Cleverly, to raise the salary threshold to £38,700 from £26,200, even if the 70% rate is still applied to recent graduates, is a real challenge for some employers, particularly those hiring outside London and the South East.
As this is an election year, the political agenda is difficult to predict. Higher education is a wedge issue for the Conservatives so expect more anti-university rhetoric. Student welfare and student cost of living could put tuition fees up for debate. It happened in 2015 when Labour pledged to drop tuition fees to £6,000.
Sadly, I doubt we'll have an honest and open debate about education funding - debate that most employers would also like to have about reform of the apprenticeship levy.
- Robust yet competitive graduate labour market, ISE, 2023.
- Graduate programmes and apprenticeships now hybrid, but mental health issues increase, ISE, 2023.
- Employers reveal how AI is changing early careers recruitment, ISE, 2024.
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