Starting salaries for graduates are expected to rise by just 2.1% this year – the smallest increase in six years, research out today (Tuesday) has found.
The twice-yearly Graduate Recruitment Survey, published by the Association of Graduate Recruiters (AGR), shows the median graduate starting salary in 2007 is expected to be £23,431.
But graduate vacancies are predicted to grow for the fourth year running.
The survey of 211 leading employers found the number of vacancies for graduates entering the job market in 2007 is predicted to increase by 15.1%, significantly higher than last year’s actual vacancy increase of 5.2%.
The rise in the number of vacancies continues to provide recruiters with challenges – more than 40% of those surveyed anticipated difficulties in filling all positions in 2007.
Despite fierce competition between recruiters for the best talent, less than 20% believe shortfalls are attributable to their starting salaries not being competitive.
Employers cited a number of recruitment challenges, including:
- Lack of applicants with the right combination of skills, for example team-working and leadership
- Lack of applicants with the right qualifications for specific job roles
- Issues with specific geographical locations
- Applicants’ perceptions of the industry sector.
Carl Gilleard, chief executive of the AGR, said: “Once again, we are seeing an increase in the number of graduate-level vacancies, which is great news for anyone applying for a graduate job this year.
“There is, however, a continuing anticipation that there will be some difficulty in filling these vacancies. The main shortfalls appear to be in industries where specific qualifications are essential and where applicants are unable to demonstrate the right combination of ‘softer’ skills, such as team-working, in addition to their academic achievements.”
What graduates can expect
- Vacancy levels: The highest growth in graduate vacancies is predicted to be in investment banks or for fund managers and accountancy or professional services firms. Increases have also been predicted within transport and logistics, construction, telecommunications and the public sector.
- Starting salaries: The largest increases are reported by organisations from the fast-moving consumer goods sector, oil and energy, water, and utilities, followed by those in banking and financial services, and construction companies.
- Bonuses and allowance: This year is predicted to see a decrease in the number of organisations offering lump sum payments for graduates, although a significant 35.4% will continue to do so, with the median amount paid out staying at £2,000.
Source: AGR Graduate Recruitment Survey 2007