The job market for university graduates in the United Kingdom has reached an unprecedented level of competition as students face challenges entering a decelerating labour market. The Institute of Student Employers (ISE) has revealed that the number of applications per vacancy has surged greatly, largely influenced by the evolving use of artificial intelligence (AI) in job applications.
Employers managing graduate training schemes received an overwhelming average of 140 applications for each position in 2024, marking a significant increase of 59% from the previous year. This figure, which stems from a survey conducted by the ISE, represents the highest number recorded since the organisation began this annual analysis over three decades ago. The report highlighted a notable "vicious circle" as articulated by Stephen Isherwood, the joint chief executive of the ISE. He explained that AI has facilitated the rapid submission of applications, leading to an increased volume but diminished quality, ultimately resulting in a greater number of rejections.
The sharp competition is partly attributed to a UK-wide decrease in hiring, particularly affecting sectors that are traditionally prominent recruiters of graduates, including IT and consulting. These industries have experienced a notable contraction, with graduate hiring in digital and IT falling by 35%, and a reduction of 5% in finance and professional services.
The overall landscape for graduate vacancies has shown limited growth, with large employers reporting a 4% increase in 2024 compared to 6% in the previous year. Across the board, vacancies are anticipated to grow by just 1% over the next 12 months amidst economic uncertainties and unclear government policies.
Anne Clinton, Director of Careers at the London School of Economics, acknowledged the intense challenges faced by new graduates. She noted that the reduction in hiring opportunities by smaller companies has led to heightened competition for remaining training scheme positions offered by larger corporations. Data from job aggregator Adzuna corroborates the diminished opportunities, indicating a 10% decrease in graduate job postings in September 2023 compared to the same period the previous year, with the drop in London reaching 22%.
This fiercely competitive environment has prompted some students to employ AI tools in crafting cover letters and managing the application processes. However, experts warn that while the technology facilitates application submissions, it often lacks the sophistication needed for tailored responses, which can disadvantage candidates.
Despite a reduction in the requirement for a 2:1 degree by many employers, thereby broadening the applicant pool, this shift has not alleviated the challenge. The overall outcome has been an increase in rejection notifications, which can be disheartening for applicants.
In conjunction with the graduate job market, the demand for apprenticeships and school or college leaver roles has risen markedly, with employers receiving an average of 113 applications per vacancy—a 66% rise compared to the previous year.
The role of AI in recruitment remains a contentious issue. The ISE survey found that while over 40% of employers are accepting of candidates using AI at certain stages, nearly a third discourage its use albeit with no strict penalties.
Moreover, changes to visa regulations have compounded the challenges for international students. Nearly 30% of employers have decreased their recruitment of international graduates, and some have even rescinded existing job offers.
Isherwood emphasised the need for candidates to be cautious of the increasing ease of job applications due to AI, which inadvertently raises application volumes but not necessarily the quality. He advised students to focus their applications and gain practical work experience, as employers increasingly offer roles to former interns each year.
Source: Noah Wire Services