Recession slams grad jobs

Investigations Editor 15 January 2009

The economic downturn has had a profound impact on the career choices of Cambridge students, according to a draft copy of a report seen by The Cambridge Student (TCS). The report, which is currently being compiled by the head of the Cambridge Careers Service, Gordon Chesterman, details how the ‘anxious and volatile’ jobs market has led many students to direct their interest away from the financial sector.

Mr Chesterman told TCS that in recent weeks the situation has got worse for UK finalists. He said that ‘the recession is now touching more employers in more sectors’ and that this had led to a change of tactics amongst some top employers. The contraction, he said, has led to ‘the hunters becoming gatherers’. Employers are letting top graduates come to them rather than searching them out at careers events. Some reports have suggested that certain companies are now restricting their focus to just five UK universities.

Many other graduate options have also been affected by the worsening economic climate including property development, postgraduate study and law. A survey by the website thelawyer.com has found that 70% of would be lawyers are worried about securing training contracts in the light of the crisis. Increased competition from those fleeing the financial sector was highlighted as one of the major reasons why many felt that this year would be especially difficult for law graduates.

The Careers service in Cambridge itself has also been put under pressure by the downturn as more students seek advice, interview practice and contact with employers. Staff have needed to work overtime in order to meet the increasing demand for careers guidance. Although the Careers Service’s report highlights the relative employability of Cambridge graduates, it notes that some of this year’s finalists have had their offers of employment withdrawn or delayed.

Whilst interest in banking, finance and property has fallen dramatically, the number of students inquiring about careers in the public sector, teaching and charity has risen. The Careers Service’s ‘For more than profit’ careers event was this year’s most popular, whilst the number of Cambridge students registered online with the high-profile teaching charity ‘Teach First’ has risen by over 500% compared to last year.

National figures regarding graduate career interests paint a similar picture. 44,000 people applied for just 500 places on the Civil service ‘Faststream’ programme, a 22% increase on last year. The NHS has reported an 83% rise in applications for its graduate training scheme, according to a research by ‘Highfliers’.

The dramatic shift of interest shown by Cambridge students is highlighted by the attendance figures for the major careers events, organised at the Careers Service headquarters Stuart House. There were a third fewer students at this year’s ‘careers in property’ event and almost half as many companies.

The banking event, usually one of the most popular, saw over 100 fewer students. According to the Careers Service’s report, one major investment bank recorded a 17% fall in applications from Cambridge students compared to last year. The report argues that the shift in interest away from banking and property is unsurprising given that students would not wish ‘to join an industry in a state of upheaval’.

The report also shows that more students are applying for postgraduate studies, with Cambridge seeing a 13% rise in applications. Oxford has seen an 18% rise in applications, Birmingham a 24% rise and Warwick an 8% rise. Almost half of all Cambridge students go on to take further study or join postgraduate training schemes in law and teaching. The percentage in some subjects, such as Maths, can be as high as 70%.

Although interest in certain job sectors has waned as a result of the economic crisis, use of the Careers Service has increased, with Stuart House reporting over 2000 enquiries in one week alone. The service has also seen a loss of income as a result of fewer organisations attending careers events and a need for staff to work longer hours.

Mr Chesterman highlighted the new tactics being employed by the service to face up to the recession.

“We’re cold calling employers, offering employers free attendance at careers events, tapping into our alumni network to tease out hidden opportunities and contributing to the national debate.”

“In a recession the careers service is hit by a double whammy – much more student demand and less income from employers. We have to do more with less.”

There are however some optimistic conclusions to the Careers Service’s report. Cambridge graduates, it claims, should be able to move into their first choice sector of employment after a few years in work due to the nature of the UK jobs market. The report also notes that some of the reaction from employers may be premature, with further job offers being made later in 2009.

The government has also taken action to reduce the impact of the recession upon graduate employment. It was announced this week that 300,000 internships would be funded at four major companies, including Microsoft and Barclays, in order to keep graduates in paid work. The scheme is intended to reduce the pressure of record numbers of graduates competing for shrinking job places.

Up to three million people are expected to be unemployed in the UK by the end of 2009, of which almost half will be under the age of 25.With average student debt upon graduation nearing £20,000, many university leavers will be hard hit by the financial crisis.

Cambridge graduates, however, are amongst the best placed in the UK to weather the financial storm. A survey conducted in part by the Cambridge Careers Service looked at average wages and career paths of graduates three and half years after entering employment. Among respondents the lowest pre-tax salary was £7000 per annum and the highest was £70,000. Women were found to be earning slightly more than men with an average wage of just over £27,000. According to the Higher Education Statistics Agency this places Cambridge graduates as the second most highly paid after those from the London School of Economics (LSE). Cambridge graduates also have one of the lowest rates of unemployment six months after graduation.

Mr Chesterman also feels that Cambridge students should not be overly pessimistic about the economic downturn.

“If there is some comfort in history, during the last recession the Cambridge figure for unemployment actually fell whilst the national figure increased. The careers service helped Cambridge students pull the rabbit out of the hat – we’ll try again this time.”

Pete Jefferys

Investigations Editor