Survey finds 4.6% increase in hiring, but median graduate starting salary remains unchanged
Students graduating from university have the most positive employment prospects since the onset of the financial crisis, despite competition for jobs remaining fierce.
A survey of the intentions of the 100 largest organisations recruiting graduates – including Apple, Oxfam, Marks & Spencer and MI5 – has found a 4.6% increase in hiring, raising graduate recruitment to its highest level since 2008.
The survey of leading employers by High Fliers Research, conducted in June, found the biggest increases in graduate employment were in the public sector and armed forces. Engineering and industrial companies are taking on 800 extra graduates this year out of the 17,000 total.
The figures confirm the progress of 2012 graduates revealed by a separate nationwide survey conducted by the Higher Education Statistics Agency (Hesa). It found that 91% of students who completed courses in 2012 were either in employment, involved in further study or training six months after they graduated.
But the Hesa statistics revealed a sharp divergence in the starting salaries of male and female graduates, with men dominating the top graduate pay brackets. Almost twice as many men as women were earning more than £30,000 after finishing their first degree.
One of the biggest drivers in recruitment is the not-for-profit organisation Teach First, which aims to fast-track students from top universities into a teaching career in state schools. This year, it has attracted 1,300 graduates as it expands further outside London, balancing out a squeeze on public sector recruitment elsewhere.
Overall, graduate hiring rose in nine out of 13 sectors, including the law, investment banking and accountancy, marking a recovery from the depths of the recession, which produced declines of 18% in 2009 and 6.7% in 2008.
But while there may be more jobs for graduates, the lingering effects of the slump and continued austerity mean that those first graduate pay cheques remain depressed. The median graduate starting salary in 2013 remains unchanged at £29,000, the same as it was between 2010 and 2012.
One reason that salaries are unchanged is that competition for graduate jobs is still intense. Martin Birchall, managing director of High Fliers Research, said: "Our latest research shows that competition for individual graduate jobs remains fierce, with employers receiving an average of 46 applications per vacancy this year."
The competition for places allows employers to be more choosy. The survey found that three-quarters of recruiters now insisted on a 2:1 degree as a minimum requirement, and one in four specified an A-level tariff in the range of BCC to AAB.
The effects of retrenchment continue to be felt in the retail sector, traditionally one of the largest areas of graduate employment. Recruitment dropped by 233 places between 2012 and 2013.
The Hesa survey of 2012 graduates, published last week, reported that two-thirds of those with jobs were in professional sectors. Of the remainder, sales and customer service occupations accounted for 13% of all university graduates in employment.
Graduates with bachelor's degrees working in the UK reported average salaries of £21,000. Above the £25,000 mark there was a sharp divide between male and female starting salaries. While women were in the majority among graduates earning less than £25,000, male graduates dominated the higher brackets at £25,000 and above. As a result, the mean salary for men was £2,000 higher than for women.
About 28% of male graduates had starting salaries of £25,000 and above, compared with 17% of females. The Hesa survey did not break down its results by gender and industry destination to explain the wage gap, but one factor may be the larger number of women earning degrees: 172,000 female first-degree earners were recorded, or 57% of the total, compared with 129,000 males.
Professor Michael Gunn, vice-chancellor of Staffordshire University and chair of the million+ university thinktank, said: "These statistics confirm that even in a very difficult labour market, studying for a degree on a full-time or a part-time basis remains one of the best ways of securing employment and a career."
