Graduate vacancies now predicted to fall by 5.4%

Oh, the halcyon days of last summer, when people were still happy to use phrases like ‘minor downturn'.  Back in July, the Association of Graduate Recruiters' member firms were confidently predicting an 11% increase in graduate vacancies for 2009.  Just a few months later - following further seismic shocks to the global financial system and the consequent impact on economic and employment prospects - the anticipated 11% increase has metamorphosed into a 5.4% decline.

Some employment sectors have been hit particularly hard.  Graduate vacancies in investment banking have dropped by 28%, while opportunities in construction have dipped by 16.6%.  Lesser falls have been experienced in financial services (down 10.7%) and IT (down 7.1%).  But it's not all bad news - vacancies in FMCG are up by 12.9%, and engineering vacancies have increased by 8.3%.  (Which means that instead of succumbing to the lure of well-paid City jobs, this year's science and engineering graduates at least have the option of taking up careers more closely related to their degrees.)

Despite everything, AGR chief executive Carl Gilleard believes the situation isn't as severe as it could be.  "We saw a sharper decrease in 2003, for example, when recruiters had a negative reaction to the dotcom crash," he says.  "By and large, while no-one doubts the seriousness of the current economic downturn, the picture for graduate recruitment, though worrying, could be bleaker.  There are even some silver linings, with growth predicted in the engineering and public sectors - both of which are likely to appeal to graduates seeking job security this year."

However it remains a tough outlook for the class of 2009 - who are also the first tranche of students to have paid three years' worth of top-up fees - especially as starting salaries look set to remain frozen "for the first time in recent history."  In addition, more than half of the employers polled claim that students lack the skills they're looking for, with many increasing their overseas recruiting activities as a consequence.  Interestingly, less than two-thirds (62.7%) of graduate recruiters are confident of avoiding a shortfall in terms of filling their graduate vacancies this year - noticeably lower than last year's figure of 68.6%.

All of which suggests that, even though the number of vacancies may be down, the competition for quality candidates is likely to remain as intense as ever.  Leading employers will still be undertaking plenty of graduate marketing activity - even if they don't have as many positions to fill as last year - since there seems to be a growing awareness of the importance of maintaining a strong brand presence at all costs.

The AGR survey highlights ‘campus fairs/campus promotions' as the one form of graduate marketing activity likely to see increased spend this year, potentially up by around 11%.  As Hugh Young (MD of specialist on-campus marketing agency Graduate Promotions) notes, "In the UK, active on-campus promotion of the recruiter brand is a phenomenon only of the last eight years, so on-campus has never been through a recession before.  The survey indicates that recruiters feel that on-campus is what they need to keep doing to protect the investments in brand equity of recent years."

The simple fact is that the war for talent isn't going away - a conclusion also endorsed by the CIPD's newly-published report on talent management in the downturn, which confirms that "the war to keep top talent remains a priority for most organisations."  While three-quarters (74%) of this research's 700+ respondents have left their talent strategies unchanged, nearly a fifth (18%) of those who've revisited their strategies are placing even greater emphasis than before on identifying, developing and retaining talent.