Starting salaries for new graduates have risen to a median of £21,000 this year, according to a study by Personnel Today’s sister publication, IRS Employment Review.
The research also reveals that although four out of 10 employers targeting recent graduates have experienced recruitment problems this year, starting salaries have increased by just 2.4% over the past 12 months – some way behind the 3% rise across all staff groups.
This slowdown follows a long-term trend for graduate salaries to rise at a faster rate than wages in the economy as a whole.
The survey shows that the lowest median starting salary (£20,250) is found in the public sector. But there is a broad range of pay rates across all sectors, running from just £12,500 at the foot of the pay table, to £31,000 at the top.
This year’s is the 17th annual IRS Graduate Recruitment Survey, and it is based on responses from 150 organisations, which together employ 1.8 million people.
In 2005, the last year for which figures are recorded, more than one-third of a million people gained a first degree in the UK, more than half (54%) of which were firsts or upper seconds – a total of 32,500 first-class degrees, and 132,800 upper seconds.
…making it harder to find the right person
With four out of 10 employers finding it difficult to fill new graduate posts this year, many have had to discover new ways to boost applicant numbers.
The IRS research shows that the most common approach adopted by employers is to try another recruitment method (22%), or to advertise in a different medium or publication (16%). Just over one in 10 (11%) believes the answer is to improve starting salaries.
Other approaches include speeding up the recruitment process to avoid losing good candidates to rival firms (11%), re-advertising in the same publication (9%), and widening the range of acceptable degree subjects (9%).
But the research also reveals that many employers continue to use recruitment methods that they know are ineffective.
More than three out of five employers (61%) turn to university careers services, even though just one in seven (15%) considers this to be the most effective method, and one in 10 uses Jobcentre Plus, even though none consider it the best recruitment tool.
Overall, only two recruitment methods appear to punch their weight: national newspaper advertisements, used by 24% of employers and considered the most effective method by 26% and student sponsorships, used by 17% and considered most effective by 16%.
…but age laws will make little impact
Nearly nine out of 10 organisations that recruit graduates (89%) reviewed their policies and procedures in advance of the Age Discrimination Regulations. But less than half (43%) modified them as a result.
Bringing graduate recruitment into line with the legislation is not easy – not least because far more younger people (37% of those aged between 25 and 29) than older (24% of those aged 55 to 64) have degrees. But while many organisations believe it will have an impact on graduate recruitment and development in the long term, more than a quarter (27%) said it would have no impact at all.
By Mark Crail