Are you ready for recovery?

Dr Charlie BallHead of HE Intelligence

Graduate Prospects

What is the current state of the graduate jobs market?

- Recovering, slowly and patchily

- Some sectors and regions recovering faster

and more vigorously

- Not, in general, back to where we were pre-

recession

An improving economy - Employer hiring intentions

From the Bank of England Agents’ Summary of Business Conditions January 2015

324,015 first degrees were awarded toUK-domiciled graduates last academic year.

Most graduates (73.6%) were working six months after leaving university – 188,590 graduates

Unemployment was 7.3%, the lowest since the recession.

12.4% went into further study.

Most subjects appear to be having a better time of it than last year.

Subjects seeing particular improvement – architecture and building, creative arts, engineering

What Do Graduates Do?

Uncertainty

We have an ongoing economic recovery but there is still uncertainty

Global uncertainty

• Global slowdown in crucial economies • Sharp fall in basic commodity prices

Uncertainty about national issues

• Uncertainty about shape of next Government – could be coalition or minority

• Uncertainty about crucial aspects of policy post-election

Skills shortages

Increased demand for skills leads to shortage.

Clear signs of skills shortages in professional

occupations

• IT

• Engineering

• Financial services (particularly those with a little

experience)

• More expected to emergeWe’re looking at graduates skills shortages in conjunction with UKCES and are expecting to have something out by the end of the month

Changes in UK occupational structure 2007-2013

managers, directors and senior officials

professional occupations

associate prof & tech occupations

administrative and secretarial occupations

skilled trades occupations

caring, leisure and other service occupations

sales and customer service occupations

process, plant and machine operatives

elementary occupations

-500,000 0 500,000 1,000,000

149,400

714,300

180,400

-356,700

-206,700

327,700

-67,800

-222,300

-24,600

Wages – changes to real weekly earnings since 2008 by earnings group

Source – Institute of Fiscal Studies, “The IFS Green Budget 2015”

Wages Increased economic confidence boosts capacity to offer wage rises – but also expectation of rises.

ONS data suggests wage pressure for many professional qualifications is increasing.2015 graduating cohort is first to pay £27,000 for full three year degree.

Winter 2011 AGR survey showed that employers believed graduates would have higher salary expectations as a result

Employee mobility and retentionIncreased employee confidence leads to them being more likely to consider moving jobs.

Impact on employee retention.

Increased rates of employee turnover being reported.

Competition for talent likely to intensify.

The regionsOne of the effects of recession seems to be to have reduced the proportion of graduates staying on in the city they studied

The graduate jobs market in some cities will continue to thrive• Birmingham• Manchester• Leeds• Edinburgh• Glasgow• Cardiff• Belfast• The commuter towns and regions of the east and south

east

Graduate Prospects is looking at regional graduate labour markets and will be publishing in the next couple of months.

The regions

NE NW Yorks E. Mids W. Mids East London SE SW Wales Scotland N. Ire-land

Loy-als

0.6231412639405

2

0.5889740108611

3

0.4591606662302

72

0.4038359554534

21

0.4538322688142

18

0.3136470055131

79

0.2892095357590

9

0.3610094311183

81

0.4040411462160

18

0.6484036263303

12

0.8428229491550

01

0.8172205438066

46

Stay-ers

0.1373915737298

64

0.1220907680372

38

0.1827041966688

49

0.1522008131518

47

0.0965703971119

134

0.0660070991616

948

0.1243161856963

58

0.1053356875242

23

0.1385745775165

32

0.1215346209433

71

0.0616522811344

02

0.0049093655589

1238

Re-turn-ers

0.1570631970260

22

0.2027734678044

99

0.2495454214851

99

0.2951210889163

87

0.3108858650374

9

0.4048787855902

12

0.2301380175658

66

0.3262994703070

47

0.2955914768552

54

0.1564840362633

03

0.0442445782258

65

0.1642749244712

99

In-com-ers

0.0824039653035

936

0.0861617532971

291

0.1085897156156

81

0.1488421424783

46

0.1387114690363

79

0.2154671097349

14

0.3563362609786

61

0.2073554110503

41

0.1617927994121

97

0.0735777164630

141

0.0512801914847

32

0.0135951661631

42

5%15%25%35%45%55%65%75%85%95%

In summary

2015 is likely to see a continuing recovery in the UK graduate jobs market.

Some uncertainty, but much will be resolved in MayRecovery brings obvious benefits, but also challenges

- Skills shortage- Pressure on wages- Competition for talentThe regional agenda continues to be important