Recent data shows a highly competitive labour market for early career workers and a slowdown of hiring growth. Stephen Isherwood explores key trends that HR professionals should be aware of.
This year was no exception. The early career labour market reflects the current economic climate.
The Institute of Student Employers’ (ISE) Student recruitment survey reveals that the competition for jobs has reached new levels, as employer hiring growth rates are slowing down. The number of student applications has increased as employers have reduced barriers to applying, while candidates are embracing AI in their applications.
You can Download the Top Ten Trends, In the meantime, let’s explore further how employers are reacting to economic trends and the future.
Hiring Under Pressure
We are happy to see the increase in recruitment of graduates and those who have just graduated from high school or college.
Growth rates are now in the single digits. The graduate market has grown modestly by 4% over the last year compared with 6% the year before, while school leaver hiring increased by 9% compared with 20% the year before.
Employers now expect a growth of just 1% in the number of graduate jobs and 7% for school leavers respectively.
Budgets are also under pressure if the economy doesn’t grow. ISE Members say they’re expected to achieve same or greater outputs with reduced resources.
In a difficult economic climate, the hiring of students is under pressure. Growing businesses need more staff and when growth slows down, organisations require fewer new hires. It can be hard to justify hiring entry-level staff when an organization is trying to reduce its overall headcount in order to control costs.
Long term goals
We have always encouraged employers at ISE to consider their long-term needs for talent. In the long-term, employers will face two major challenges in the labour market: declining fertility rates and an increased demand for highly qualified people.
We believe that the slow economic growth is shielding employers from these two pressures. Once growth returns, employers will face a shortage of talent. The hiring crisis that followed the pandemic showed how quickly labour markets could tighten.
It is hard to predict future resource requirements. Many employers find it difficult to set hiring targets for 12 months in advance (the typical cycle of student recruitment still occurs from September-September). The duration of student development programmes is often longer, ranging from two to three year.
In a few short years, the organisation may not notice any impact if it reduces its hiring.
Over the next three or four years we can expect to see growth rates pick up. (The OECD has predicted that the UK economy will increase by 1.2% in 2025). We always advise budget holders and workforce planners to be cautious when it comes time to recruit and develop students. Today’s recruits will be tomorrow’s leaders.
ISE’s most heated discussions revolve around recruitment challenges and future hiring.
ISE offers Personnel Today members an exclusive 10% off their leading industry-leading one-day conferences. Visit their website to learn more and sign up today.
Join us and learn from the best experts in the field and meet your peers at our flagship conferences. Join exclusive webinars about current issues. Sector forums are a great place to share challenges and ideas. You can also find quick answers in WhatsApp groups. ISE members have access to our exclusive ROI and research tools.
