Graduate tax-breaks urged for employers who take on university-leavers

Graduate employers should be given tax breaks to encourage them to hire more young workers, the Association of Graduate Recruiters (AGR) has said.

Launching its manifesto Talent, Opportunity, Prosperity, the association has set out its vision for higher education in the UK and the active role employers should play in it.

Carl Gilleard, the chief executive of the AGR, told Personnel Today that the financial incentive would encourage employers to open up more vacancies to graduates.

The call follows research by the AGR which found that the availability of graduate jobs fell by 8.9% last year, while 2010 could see a further decrease of 1.6%.

Vacancies for university-leavers are only expected to rise again in 2011.

Gilleard said: "To recruit someone is an expensive process, particularly if you intend to develop that person, as people recruiting graduates will do.

"Many employers can find work for people to do but what prevents them going forward is the cost of hiring that individual.

"We think if we could incentivise graduate recruitment in some way it would act as a catalyst for increasing the numbers of vacancies that graduates are recruited to."

He said the AGR was still working on the exact level of tax breaks it would call for, but added that the incentive should cover the first 12 months of the graduate's employment.

The idea, he said, came from provisions currently in place to subsidise the training of apprentices.

Gilleard also called for the embedding of employability skills in all degree courses and more high-quality work experience for students before and during their time at university.

The AGR added that best practice guidance and more practical support was needed for university and school careers services, and sid the 50% target for participation in higher education should be abolished.

Gilleard added: "There has never been a greater need for government, employers and universities to build a shared vision for higher education. I do not believe it is over-stating the case to say that the UK's prosperity and productivity are depending on it."

Last week the AGR and graduate recruiters called on employers to consider moving away from "arbitrary" academic qualifications when assessing candidates for graduate schemes, to improve their retention and diversity and source more suitable recruits.