UK: Cold climate for graduates

British students are facing an almost unprecedented squeeze on jobs when they graduate this summer, the Association of Graduate Recruiters has warned. In its latest bi-annual survey published last Wednesday, the association finds that vacancies are expected to decrease by 5.4%, banks expect a 28% cut in the number of jobs, and salaries will be frozen for the first time in recent history.

The survey of 250 companies, including Cadbury, Barclays and Google, says this year's median starting salary is stuck at the 2008 figure of £25,000 ($36,230), while some employers, notably in banking and financial services, will be cutting graduate salaries by up to 8%. The association says the salary freeze will be a particular blow to 2009 graduates who are the first to have contributed tuition fees for the full three years of their degree courses.

Carl Gilleard, chief executive of the AGR, said: "Last summer our members predicted an optimistic growth in vacancies of over 11%. Soon after that we saw a series of catastrophic events in the financial sector with serious consequences for many other sectors such as construction.

"It comes as no surprise that these seismic shifts in the economy are being mirrored to some extent in the graduate jobs market. The predicted rise in jobs in 2008 simply did not occur. However, though we are set to see a drop in vacancies this year, the situation is certainly not as severe as it could be. We saw a sharper decrease in 2003, for example, when recruiters had a negative reaction to the dot.com crash."

Two-thirds of employers thought that graduates should take temporary jobs, probably in a different sector from their chosen field, 39% said it was a good idea to take a year out, while a third recommended further study to give students an edge in the jobs market. The good news is in engineering which bucks the trend with an expected rise of 8.3% in jobs, but there may be a shortfall of graduates to fill them. The public sector is also anticipating a 3% increase in demand.

Gilleard added: "What is certain is that the economic crisis is concentrating employers' minds on the war for the best and most well-informed talent. The message coming through loud and clear for this year's graduates is research, research and more research - know your potential employer and know your sector. For those who do not secure that dream job first time round, the key is to take some form of paid employment if you can."

The survey report coincided with publication of the latest unemployment figures which showed a rise of 146,000 between October and December to 1.97 million, the highest level since 1997. The unemployment rate of 6.3% is the highest since 1998.

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diane.spencer@uw-news.com