Are these the green shoots of recovery?

This blog first appeared on Luminate in May 2021. In it I look at a tumultuous couple of years for graduate recruitment and use new data from an Institute of Student employers (ISE) poll to argue that things might be getting better.

In April ISE polled its membership and asked whether they were recruiting more or less graduates than last year. The response was very positive with 36% of employers saying that they were going to increase the volume of their graduate recruitment this year, while only 16% reported that their recruitment was continuing to shrink.

The picture was remarkably similar with respect to internships and placement students, where 24% were anticipating growth and 20% further shrinkage. These data points reveal that graduate employers are feeling a lot more optimistic than when we last surveyed them in the autumn.

In general, this is good news for employers, for the economy and for graduates. As lockdown ends, hiring seems to be on the up.

There is always a ‘but’

Of course, when you are looking at something as complex as the labour market there is usually more than one story. So, while the graduate market as a whole seems to be bouncing back the picture is not so rosy in the retail and FMCG sector, where 38% of employers are still contracting their hiring.

There are also sectoral variations in the hiring of interns and placement students with 40% of employers in the energy, engineering and industry sector still contracting and 36% of employers in the retail & FMCG sector also contracting their work experience offer.

This story fits with the strongly sectoral way in which lockdown and pandemic have impacted on the economy. While broadly speaking the pandemic has been bad for the economy, it has been much worse for some sectors than others. Some are only just emerging from the battering that they have received over the last 14 months and aren’t ready to start hiring yet.

This leads us to the bigger question of how big the bounce back is going to be. Our polling gives us reasonable confidence that employers will be hiring more graduates in 2021 than they were in 2020. But, whether we will return to pre-pandemic levels of hiring is unclear. Even if the pandemic were over (and it isn’t) and the economic recession was over (and it is not), there are other things going on in the economy that might have a long term impact on graduate recruitment (remember Brexit?).

So while the future is brighter, it is not clear yet how bright it is going to be. We asked ISE members to give us an indication of their confidence about the future and a very mixed picture emerged. While most were positive about the health of their own organisations and broadly in agreement with the idea that the worst of the pandemic was over, they were generally more pessimistic about whether there were enough opportunities for young people and concerned that the worst of the economic crisis was still to come.

What will graduate recruitment look like in 2021?

Graduate recruitment is a tanker that can be slow to turn. While employers have some latitude to turn recruitment levels up and down mid-year, as we saw in 2020, most decisions about the volume of hiring are made on a longer timescale. The fact that employers have been revising their hiring plans upward as the country emerges from lockdown is good news, but we will have to wait and see whether this is an ongoing upward trajectory or a cautious initial move out of the crisis of 2020.

What is clear is that the graduate recruitment of the future is going to look different. Employers have made huge strides in digitising all aspects of their recruitment, selection, onboarding and development processes. Most are indicating that they see the future as blended rather than fully online, but there is an intent to do things differently in the future.

So, the 2021/22 academic year is unlikely to see a return to big careers fairs or lots of employers on campus and at least some work experience is likely to continue to be virtual. It is possible that the pandemic might finally have killed off a lot of printed publicity materials and extravagant giveaways, but in all honesty the new paradigm for graduate recruitment is still being born. ISE members are signalling that the marketplace is going to look different and more digital than in the past, but there is a lot of room for new ideas and innovations.

Be positive, but keep your eyes open

Our latest data gives us lots of reasons to be positive and optimistic about the future of graduate recruitment. But, there are still a lot of open questions about what that future is going to look like. It would be a very brave prognosticator who predicted that ‘things can only get better’ from here.

If the last year has taught us anything, it is surely that the world is highly unpredictable. The new world of graduate recruitment is still emerging, but at ISE we are watching very carefully and we’ll be keeping you informed as the picture gets clearer.

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