Number of new graduate jobs falls for first time since financial crisis as leading recruiters downgrade hiring plans

This article is more than 2 years old

This article is more than 2 years old

Uncertainty over Brexit has caused many of the UK’s most prestigious employers to significantly cut their recruitment of graduates, resulting in a fall in the number of new graduate jobs for the first time since the global financial crisis.

A survey of the UK’s leading 100 graduate recruiters – including Goldman Sachs, Unilever and BP – found many had downgraded their hiring plans after the Brexit referendum vote, with private sector organisations recruiting 10% fewer graduates by the end of 2017.



While many companies expect to improve their recruitment targets this year, the figures reinforce concerns about graduate employability when combined with Brexit and spiralling student debt in England.



“It’s clear from our latest research that the uncertainty caused by Brexit has already hit the graduate job market,” said Martin Birchall, the managing director of High Fliers Research, which conducted the survey.



“Although employers in a number of key industries and business sectors are hoping to increase their graduate recruitment again in 2018, the outlook of many recruiters remains cautious for the year ahead.”.



The Brexit vote appears to have thrown graduate recruitment at big international organisations into reverse, after a bumper year for graduate jobs in 2015-16 when some employers complained of being unable to hire enough students completing their undergraduate degrees.



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Before the referendum, High Fliers found top employers were aiming to hire 22,000 graduates in the UK. Those plans were downgraded by the start of 2017 as the Brexit result sank in, and by the end of the year 19,000 were recruited.



The survey found that private sector employers cut their recruitment by an average of 10% in 2016-17 compared with the previous year. Out of 13 sectors, eight hired fewer graduates.



“Instead of expanding their graduate vacancies in 2017 as planned, the country’s best-known accounting and professional service firms, financial services companies and investment banks scaled back their recruitment targets by 17% following the Brexit vote,” Birchall said.



Only the public sector, including the NHS and civil service fast stream, continued to hire in substantially increased numbers. The engineering sector showed a small rise compared with its 2015-16 recruitment.



The post-Brexit fall may have held down graduates’ starting salaries, with the median figure of £30,000 the same as four years previously. Investment banks and law firms remained the most generous in terms of graduate pay, averaging £47,000 and £44,000 respectively.



The survey findings were published amid growing debate about the value of a university degree, both to the UK economy and to graduates, many of whom start their careers with debts of about £50,000. Members of the Lords economic affairs committee on Tuesday held a hearing to consider whether some young people might be better off not going to university.

The committee is conducting an inquiry into the economics of higher, further and technical education and is concerned that the UK may be producing too many graduates, with evidence that more than half of the UK’s workforce feel they have skill levels that are higher than needed to do their job.