Is the graduate jobs market as bleak as the headlines suggest?

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The class of 2020 is facing one of the most challenging jobs markets ever experienced, with reports suggesting graduate schemes have been delayed and work placements have been cancelled. But entry-level recruitment still remains vital for some employers – even during a pandemic. Ashleigh Webber reports

This year has been tough for all jobseekers, but especially graduates and school leavers.

Competition for graduate jobs hit a 10-year high last month and an average of 93 applications per graduate job were received in July, according to job search engine Adzuna and careers website Bright Network.

Reports also emerged about once prolific graduate recruiters having to abandon or drastically reduce their graduate intake or internship programmes.

Accountancy firm KPMG has reportedly vowed to pay for 40 graduates’ master’s degrees if they defer their placement to 2021, significantly delaying the start of their careers, while Deloitte scrapped its summer internship programme, instead offering candidates a place on an online training programme and a £500 “goodwill” payment.

A survey of 179 members of the Institute of Student Employers (ISE) in May identified a 23% reduction in student and graduate recruitment for 2020. Organisations each planned to recruit 12% fewer graduates and offer 40% fewer placements and internships than last year

But, while the figures seem to illustrate a barren jobs market, the reality is isn’t as dire some may think, suggests Stephen Isherwood chief executive of the ISE.

He says this year’s graduate and intern intake varies by sector, and with many schemes not beginning until October, firms have had time to adjust them for the socially-distanced workplace and to consider where costs can be cut, rather than scrap them completely.

“There is some recruitment happening, but we can’t pretend that it isn’t a really challenging market,” he tells Personnel Today.

“For graduates who had a job lined up before Covid hit, our evidence shows most employers have stuck with the offers they’ve made – unless it’s in an industry that’s under very significant stress, like travel and non-food retail.”

Figures from Adzuna and the Bright Network showed there were 4,689 graduate jobs available in early August – although more than half of these were in London and the South East. Employers looking for graduate talent included artificial intelligence company ARM, JPMorgan Chase, Amazon and the Civil Service.

Necessary for future success

While bringing graduates into a business that has had to streamline its headcount appears a difficult decision to justify, Isherwood says a strong graduate pipeline is still necessary for long-term workforce planning.

“Employers with a long history of recruiting students know that if you don’t keep hiring through a recession, when the upturn comes you’ll have a real talent shortage. In three years’ time, firms will need qualified lawyers or accountants. Organisations will need people moving into junior manager positions,” he says.

Our graduate hires are the future of our firm, which is why we invest so heavily in recruiting and developing trainees.” – Yasmina Kone, Clifford Chance

Industries that are particularly sensitive to economic uncertainty have had to make some tough decisions – for example, the ISE recorded a 45% reduction graduate hiring intentions in construction. But one sector that has seen barely any change in its graduate recruitment plans is the legal sector, which saw only a 4% drop.

Clifford Chance is one of the law firms continuing to offer its graduate schemes this year. Its summer schemes have taken place virtually, with a view towards offering two days of in-person learning later this year.

It has other traditional legal training schemes as well as its ‘Ignite’ tech-focused training programme. Around 90 trainees join its schemes each year and rotate through four practice areas before qualifying as solicitors.

Yasmina Kone, the firm’s graduate recruitment specialist, says: “Our graduate hires are the future of our firm, which is why we invest so heavily in recruiting and developing trainees. We look for candidates with potential – with hunger, drive, creativity, agility of thinking and enthusiasm. The rest can be taught, and we offer world-class training to support our trainees’ professional development.”

Despite reports that recruitment firms will take a significant financial hit this year, X4 Group is still expecting to onboard around 45 trainees by the end of October. It recruits into specialist life sciences, communications and technology roles – demand for which has continued despite the economic downturn.

Chief executive Peter Rabey says: “Everyone in leadership has started their careers as a graduate trainee and we feel it is intrinsic to the company we want to be.

“Although there are a few things we’ve had to change over the past couple of months, changing our entire ethos around how we hire and train isn’t needed to be successful in the post-lockdown market.”

The company recently moved into a new office with a large events space, which will now be turned into a “training hub” to allow new entrants to learn while following social distancing guidance. They will be in the office full time with their line managers and learning and development staff to begin with, but will be able to work from home when they have gained more experience.

“We’ve said to line managers that, especially in the early months of our new starters’ careers, there’s nothing that can be any better than sitting with new people and helping them gain experience in their role. All of the leaders that have decided to hire have done so with the full understanding that that would require office-based work for a period of time,” adds Rabey.

Although there are a few things we’ve had to change over the past couple of months, changing our entire ethos around how we hire and train isn’t needed to be successful in the post-lockdown market” – Peter Rabey, X4 Group

Apprenticeships

It is not only graduate recruitment that appears to be only-just surviving during the pandemic. Although the ISE’s survey found 32% of its membership planned to take on fewer school leavers and apprentices, advertising agency Ogilvy UK believes continuing its apprenticeship programmes is more important than ever. It has hired, or plans to hire, 30 in 2020 and early 2021 – up from eight in 2018.

The nature of the advertising business means there is a strong need for new and diverse ideas, and much of this creativity comes from apprentices, says head of learning and development Gavin Sutton.

“Given the funding we have invested in to the apprenticeship levy pot, it would be a real miss as a business to not take advantage of this,” he says. “It is also the right thing to do as a responsible and forward thinking business; to keep opportunities open to people starting their careers.”

Internships and work experience placements are often used as a stepping stone into a graduate role, and many summer placements still went ahead virtually. The ISE’s Isherwood says many large organisations offered a virtual internship “experience” rather than their full programme – for example, a week-long online programme including mentoring and online projects that are presented at the end of the placement.

Charity EY Foundation, which helps young people from low income backgrounds into work, has shifted the work experience programmes it runs in partnership with employers to online events, which it says improves candidates’ digital and presentation skills. For example, the placements it offers at software company Blue Prism include the opportunity for a ‘Dragons Den-style’ pitch to a panel of industry experts.

Supportive culture

But graduates and other entry-level new starters may find working from home a challenge, especially if their training programme requires a lot of hands-on experience rather than academic learning.

Isherwood says: “If you’re, for example, working at one of the big accountancy firms, a lot of the initial phases of work are about getting your professional qualification – that’s relatively straightforward as that’s happening online.

“But the challenge is understanding the culture – when you start a new job you buy in to a culture and get a feel for it by being in the office and meeting people. That’s not really happening at the moment.”

Isherwood suggests setting up online networking groups for graduate cohorts, or running virtual social events.

“I think there will be more support than ever. We’re so conscious about people feeling isolated at home – particularly new joiners with little experience – so there might be more support and one-to-one opportunities with managers,” he adds.

X4 Group’s Rabey has been offering trainees the ability to visit the office before they accept a position at the firm, even though it is much quieter than usual.

If the recession really carries on and businesses have to make further cutbacks, they may reconsider their graduate schemes for next year,” – Stephen Isherwood, Institute of Student Employers

“At least half of the graduates who have come in have requested to come into the space to see where they would be working, see what it feels like and get a sense of what their colleagues and teams would be like. I’ve been nicely surprised that a lot of people still carry great weight on the office culture,” he says.

While the optimism about graduate recruitment at the organisations we spoke to is high, there is still the possibility of a “second peak” – which could be even more detrimental to job prospects for next year’s entry-level cohort.

Isherwood says this is a major concern for the ISE. “Going back to the last financial crash, the biggest drop in vacancies was seen in the second year. If the recession really carries on and businesses have to make further cutbacks, they may reconsider their graduate schemes for next year,” he says.

There’s little doubt that the technology being embraced in this ‘new normal’ of work has made some graduate schemes and placements possible this year. But with government grants and measures to stimulate the economic recovery gradually being withdrawn, some graduate recruiters may struggle to survive – the effects of which could be felt into next year’s graduate recruitment season.

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