Labour market myths: 'all graduate jobs are in London'

With media focus on 'fake news', you'd be right to question assumptions about the graduate labour market. Equip yourself with the facts so you can challenge these labour market misconceptions…

What is the assumption?

A 'typical graduate' is generally considered, by policymakers and others, as someone who attended the best university and wants the best job available to them - inevitably a graduate scheme in a major city. Since London is the largest city in the UK, this has created the perception that all graduate jobs are in London.

How did this myth arise?

London has a high-skill economy and is, therefore, dependent on graduates. Westminster, for example, has one of the most skilled workforces in the world with 72.4% of its workforce holding a degree.1

London is the capital city, the political and media heart of the UK. It contains 23% of the country's business and the headquarters of 62 of the FTSE100.2

It is easy to see how such a ferocious demand for graduates could be confused with the idea that all graduate jobs are in London.

What are the facts?

Greater London is the biggest recruiter of graduates in the UK. In 2016, 21% of new graduates made their early forays into the job market in Greater London. Greater Manchester was second with 4.9%.3

However, despite being comfortably the largest graduate recruiter, four out of five graduates start their career outside of Greater London.

London does not have a monopoly on graduate jobs. What London does possess is the highest regional graduate starting salary and many of the country's biggest businesses. Jobs in London are highly desirable.

Given this, perhaps we shouldn't be asking whether all the graduate jobs are in London but rather, are all the jobs that graduates want in London?

Does every graduate want to work in London?

Understanding the motivations behind what graduates do is very difficult. However, we can be sure that for the majority of graduates in the UK, the biggest companies will not be found in their home region.

If graduates are chasing the best opportunities (in terms of business size and salary) available to them, they must be prepared to move. The 2016 Destinations of Leavers from Higher Education (DLHE) survey reports that:

• 58% of graduates went to work in the region in which they took their degree
• 69% of graduates went to work in the region where they had grown up.

Graduates do not appear to be mobile, so it is difficult to conclude that all the jobs that graduates want are in London.

There must be other factors influencing graduates' employment decisions, rather than just the biggest companies and the biggest salaries.

What are the future trends?

Looking at the last four years of DLHE data, there has been almost no change in the pattern of graduate migration across any metropolitan region of the UK.

Over the same period, the percentage of graduates starting their career in London has also remained relatively static, with just a percentage point separating the highest (16.7%) and the lowest (15.7%) values.

Graduates are, at least in this regard, remaining constant in their behaviour. Not all graduate jobs are in London and that is not going to change any time soon.

Also in this series

• You're better off not going to university
• Graduates all work for big businesses
• There aren't enough jobs for graduates
• Everyone has a degree nowadays

Notes

1. Annual Population Survey, ONS, 2017.           
2. Cities Outlooks 2018, Centre for Cities, 2018.  
3. Destinations of Leavers from Higher Education (DLHE) 2015/16, HESA, 2017.

Written by

Michael Grove

Information analyst

Prospects