A survey carried out by the Centre for Enterprise has revealed that almost 90% of small or medium sized companies are not planning to hire graduates during the current economic situation.
The Centre for Enterprise is a research and consultancy firm which specialises in employment and skills. Its stated aim is to improve social and economic prosperity across the UK.
The survey found that of 502 small and medium-sized enterprises (SMEs), 89% had not hired a graduate in the last twelve months and 86% were not planning to do so within the next year.
According to the Guardian Online, SMEs account for 99% of UK companies and three fifths of private sector employment.
The Centre of Enterprise acknowledge that the very number of SMEs may make the statistic less worrying for graduates than it may initially appear. According to the report even if only 11% of companies are recruiting an average of 2.5 staff, this will still amount to thousands of vacancies.
A high rate of impact and retention amongst those graduates who have been hired recently was also reported. 62% of SMEs who had hired a graduate during the recession reported that they had definitely or possibly seen a financial return upon their investment.
Only 4% of recent graduate employees were reported as leaving their positions within a year and 28% were still employed after five years.
The report expresses concern over the fact that a significant minority of SMEs appeared unclear about which qualifications constitute a graduate standard. The survey asked each company to indentify qualifications which are graduate level.
29% of SME employers believed that A Levels are a graduate level qualification and 18% thought the same thing about GCSEs. 41% failed to identify Foundation Degrees as being graduate-level.
The authors of the report wrote that, “This confusion over the graduate ‘brand’ could limit the impact of initiatives aimed at stimulating the demand for generation crunch.”
They continued, “There is a clear need to rationalise the plethora of qualification frameworks, levels, and agencies that currently litter the education and skills landscape.”
Graduate unemployment amongst ‘generation crunch’ is a cause for concern amongst policy makers. The report quotes statistics from the Higher Education Careers Service Unit which found that unemployment amongst graduates had increased by 44% in twelve months and is at its highest for twelve years.
The Centre of Enterprise also quoted The Association of Graduate Recruiters which reported in July that graduate vacancies had fallen by 25% and that on average 48 applicants now compete for each post.
The Government has established the Graduate Talent Pool, aiming to improve graduate employment prospects. The website helps recent graduates find work experience by matching them with potential employers.
Alice Mannion, a fourth year natural scientist at Emmanuel College, has just accepted a job offer following a strenuous application process last term. She told The Cambridge Student (TCS), “I think the hardest part is how many applications you need to make – even if you find your dream job the chance of getting it is so slim. I was also surprised with how many people get rejected at the first stage. My worst was an application that I submitted on a Sunday afternoon and I got a rejection at 8.15am on Monday.”
Jennifer Boon & Becky Sage