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How the recession is affecting graduate recruitment?
It's tough graduating in the middle of a recession. Media reports of cuts in graduate vacancies can plunge you into despair while good economic news gives you a surge of optimism. David Williams helps chart a course through the sea of conflicting information.
The transition from university to work is a tricky rite of passage at the best of times. You need the self-knowledge to reflect on your existing skills and aptitudes; make a realistic appraisal of your potential; create a career strategy and gather and marshal the resources to take you where you want to go. It's hard enough when the economy is strong, but when economic instability is thrown into the mix, it is no wonder graduates feel lost.
It might not make you feel any better, but the first thing to realise is that no one else knows the answer either. No one knows where the jobs are, where they will be, what information to trust, or what is really happening. Look closely at a robust set of graduate employment statistics from an advanced economy such as the UK and you quickly discover that even professionals working in the graduate recruitment industry are unable to predict the immediate future.
According to High Fliers, an independent market research company in the UK, graduate recruiters remained confident through the initial months of the financial crises, anticipating that they would increase their graduate intake by 11.8% in 2008. In fact, as the High Flier's report The Graduate Market in 2009 makes clear, actual vacancies fell by 6.7% compared to 2007. They then made the same mistake with their estimates for 2009, predicting they would hit close to their original (ambitious) targets for 2008. Yet again they over-estimated the numbers of graduates they would need and recruits fell by an anticipated 1%. In real numbers, of the 40,000 jobs employers surveyed had intended to offer in 2008 and 2009, 7,000 were either cut or simply left to go unfilled. However, the report states graduate recruiters are “reasonably optimistic” for 2010, with a quarter of organizations expecting to take on more recruits in 2010 and another half anticipating keeping their graduate recruitment at a similar level.
Graduate recruitment is fundamentally a marketing activity planned in advance.
Why are graduate recruiters so optimistic?
Whether or not this turns out to be the case remains to be seen. It is however worth looking at why graduate recruitment professionals have a tendency to be so “reasonably optimistic”. The first reason is that the HR departments may not know what is happening. Graduate recruitment is fundamentally a marketing activity planned in advance. As economic conditions change, so too do business needs which can leave the graduate recruitment department committed to marketing vacancies that no longer exist.
Secondly, graduate recruiters have what might be called a branding problem. Creating and maintaining an employer brand in the undergraduate marketplace is an expensive and time-consuming activity, particularly as the student population changes by 20-30% every year. Even if vacancies fall to the point at which this marketing becomes uneconomic in a particular year, the large investment a company has made in creating a student-friendly brand would be all but destroyed if they were to withdraw from the graduate marketplace for a year or two. Indeed, in order to maintain the strength of the brand, graduate recruiters tend to talk up the number of vacancies and the quality of opportunities to their university contacts, competitors, students and indeed themselves. At the same time, they avoid talking about the negatives. Graduate recruiters never admit to the drop in vacancies , graduate redundancies, or the deferment or withdrawal of offers that difficult times naturally bring.
Why are graduates so pessimistic?
The graduate and student population hears about such things through the grapevine. However, the high levels of credence given to anecdotal information, when combined with the over-stated optimism of recruiters, work together to make the situation seem much worse than it really is.
