Charlie Ball, Jisc's head of labour market intelligence, digs into the data behind recent doom-laden headlines about graduate job prospects to explore what's actually happening
Is this really the worst graduate labour market on record? The short answer is no. As Nick Hillman at HEPI has observed, this time of year traditionally sees a spate of negative stories about universities, and they're usually quite easy to dismiss as the data is rarely from reputable people saying sound things.
Last week saw a widely reported story from the large jobs platform Adzuna stating that the number of graduate vacancies on their platform had dropped by almost half, accompanied by a round of news pieces like the BBC one I linked to gravely informing everyone that the graduate jobs market is collapsing (again). AI, as usual, is at least partly to blame.
There's been an unusual level of pushback from all sorts of people involved in the sharp end of recruitment.
Now, this isn't a case of some dodgy stats produced for publicity or a vested interest. Adzuna are a serious organisation who do a difficult job - trying to rapidly examine the labour market using vacancy data - very well. If they report a piece of data, it cannot and should not be simply dismissed. But at the same time, there's been an unusual level of pushback from all sorts of people involved in the sharp end of recruitment, from recruiters to people in student support, saying that they're not seeing a jobs market anywhere near as bad as this.
Let's establish one important point first - the graduate jobs market is not strong right now, it is clearly in some pain and we're keen to work out how tricky it is so we can help students and those helping them to understand it better. This is not an 'actually everything is ok' piece, this is a 'how bad is it really?' piece.
So what are Adzuna actually saying? Well, the graduate jobs claim is only a part (and quite a small one at that), of a much larger data release. It's the choice of media outlets to lead on this story, not Adzuna's. They're saying the jobs market for graduates is worse than it's ever been since they started measuring in 2016 - the best graduate jobs market they record was in 2017 - and that vacancies have halved in a year. This is actually an extremely significant claim.
If the number of UK graduate jobs had really halved in a year, that would make it comfortably the worst year on record for UK graduate recruitment by a very significant margin, beating the previous record holder, 1981 - when unemployment was heading towards three million, the rate stood at 9.6% (it's currently 4.9%, almost exactly half that), and we saw an extremely severe recession with consequent public discontent, including mass marches. It means Adzuna are explicitly saying the graduate labour market is worse than it was during the 2020 COVID lockdown, when we lost over 800,000 workers and the economy was shuttered. Furthermore, this is only happening to graduates, it's not showing up in any other data and nobody seems to have noticed, even though graduates make up half the UK workforce.
Not to put too fine a point on it, but this is not what is happening, and anyone wanting to report this statistic straight needs to be aware of what they're saying about the economy.
Adzuna's data is very good, but their graduate data has always been slightly out of step with the rest of their output. For methodological reasons it's much harder to pick 'graduate jobs' out of a dataset than it is jobs from a specific industry - in the latter case there are standard coding frameworks that allow you to assign companies to industries and, although a tricky thing to do, it's basically a solved problem especially if you're a tech savvy business with really good data skills, which Adzuna are.
'Graduate job' is a different kettle of fish though, starting (and not ending) with the issue that we don't even have a standard definition of what that is, and then you have to derive it from the content of ads. The big clue of what might be happening here is in another bit of their claims - they say their best data on the graduate jobs market was 2017 and the problem with that is 2017 wasn't the best year for the graduate labour market in the last ten years even if their data says it was.
Recruitment behaviour has changed, and if that's changed, so should the methods you use to monitor it.
In any case, the data says jobs stand at 8,383 graduate vacancies listed in July, down from 15,397 at the same point last year. 15,397 is probably somewhere between 5% and 10% of all jobs graduates got last year, so Adzuna have only ever captured a small, unrepresentative sample of graduate vacancies and now that proportion is an unknown amount smaller.
So what does this data mean? Shall we ignore it? No, because Adzuna do seem to be showing us something. Recruiters have been really clear on two things about AI in the UK. Firstly, it's not having a massive impact at scale on jobs. Some jobs are being replaced, more are being modified, but they're mostly in specific niches where the tech is proven to work and in general employers are cautious about the true abilities of current AI models and about preserving a long-term talent pipeline. Secondly, it has really hit recruitment and generally made it substantially tougher for both applicants and recruiters by allowing candidates to make large numbers of AI-powered applications.
The response from recruiters has been varied but one thing is clear - few believe that the methods they had used for years up until about 2024 really work anymore. This means recruitment behaviour has changed, and if that's changed, so should the methods you use to monitor it. Put simply, the methods the aggregators used to track graduate vacancies probably don't work as they did any more, and this data doesn't show a huge fall in opportunities available to graduates as a whole but does show that the way we understand how to track, and to search for graduate jobs needs to change.
So what does that mean for the graduate labour market? The rather dull final answer is that our best estimate is that currently it's sitting about where you'd expect in an economy that isn't in recession, but that hasn't had significant economic growth in a decade (but what growth there has been has been largely at the graduate end of things), and where a big geopolitical shock (the Iran war) has made recruiters anxious about unexpected cost increases.
In other words, it's pretty subdued, it's probably not in recession, it's bumping along about where it's been in the last couple of years in a kind of holding pattern waiting either for a big shock (employers are nervous about an AI bubble) or some good economic news (let me know if you see any) to change the cycle. 'Graduate labour market probably not that different to last summer' is not a very exciting headline, but it's probably not far off the truth.
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