The global financial crisis is taking its toll on the employment market in the UK. The jobless total rose by 164,000 in the three months to September, the biggest rise for 17 years, and the number claiming jobseekers’ allowance jumped again in September. Much of the pain is being felt near the bottom of the jobs ladder, as house-building grinds to a halt. But well-paid work is scarcer too. According to Morgan McKinley, a recruitment specialist, vacancies in the city of London are 40 percent lower than last year, with a 42 percent rise in the numbers looking for work in financial services.
The class of 2008 is probably safe; recruiters decided how many of them to take on before the recent turmoil, and most honoured their promises. But what of the class of 2009? “We’ve had five years of continuous growth in the graduate-jobs market,” says Carl Gilleard of the Association of Graduate Recruiters. “I can’t see that growth continuing.” In July a survey of its members showed graduate recruitment holding steady. But even then, confidence was waning: it found the lowest increase in starting pay in recent years, and most employers said there would be at best a cost-of-living rise next year.
The consensus, it seems, is that graduates in 2009 will emerge from their studies into a world that is chillier, rather than utterly changed. Some would-be high-fliers will simply switch from one A-list career to another; there are early signs of a surge of interest in postgraduate training for law; management consultancy will attract some who might previously have gone into banking or finance. Even in fields directly affected by the downturn, hiring has slowed, not stopped. There are still new jobs in finance, says Kevin Green of the Recruitment and Employment Confederation, although they are fewer and are now more likely to be in risk management and IT than in sales.
Most graduate employers will keep hiring at least a few bright young things, says John Philpott of the Chartered Institute for Personnel and Development: “During the recession of the 1990s many didn’t, and suffered later.” Global businesses will still hire too, but may ask their graduate recruits to work abroad at first, he thinks.
The most profound effect of the downturn may be not on employers’ thinking, but on graduates’. Unlike their elders, they have no memories of previous recessions, and no experience of gritting their teeth and waiting for better times. One beneficiary is likely to be the public sector, as job security and final-salary pensions look particularly appealing right now. “I used to recruit for the public sector,” says Gilleard, “and whenever there was a mini-recession we got the sort of high-fliers applying that we wouldn’t normally see.”
Other graduates will decide to put off the day of reckoning: post-university gap years may become more popular, says Green (although he warns that 2010 could prove just as tough a time to look for work, so gappers had better do something suitably CV-enhancing). And research by the Higher Education Careers Services Unit shows that more graduates keep studying when the jobs market is tight. “In 1992, when unemployment reached its highest levels since the early 1980s, more than 30 percent of students went straight back into higher education after graduating,” says its chief executive Mike Hill. “So we’re likely to see a surge in postgraduate entry in the next couple of years.”
The biggest winner from recession may be the teaching profession — particularly in maths and physics, where it has long struggled to compete for talent with banking and finance. Applications for teacher training in these subjects go up when the government offers golden hellos and other incentives, say Alan Smithers and Pamela Robinson of Buckingham University — but high graduate unemployment causes a surge too. It looks as if the pattern is set to repeat: the Training and Development Agency, which oversees teacher training, says its website has received a third more hits this year than last, and registrations of interest are also up. Hidden inside one crisis may be the solution to another.
(Excerpted and adapted from The Economist)