Class of 2016 graduates braced for fewer jobs and lower pay

• Advertised graduate roles fall 8.0% year-on-year in April, with 12,850 vacancies currently available as new entrants to the jobs market face tough hiring environment
• April sees 1,156,810 advertised vacancies across the UK, falling 0.3% from 1,160,058 positions seen in March, as economic uncertainty leads to nationwide hiring stall
• Average entry-level salary sinks to a 30-month low at £23,309, the lowest starting pay since October 2013
• Average advertised salaries also fall this month to £33,462, dropping 1.0% from £33,815 in March and reaching a four-month low
• Job competition in the UK reduces to 54 jobseekers per 100 vacancies (0.54) in April
• Oxbridge cities the best place to find a job for new graduates, with only 8 jobseekers hunting for every 100 roles on offer in Cambridge (0.08) and just 12 jobseekers per 100 openings in Oxford (0.12)

This year’s crop of graduates are facing lower pay and fewer positions, as a wider slowdown in the jobs market holds back hiring, according to the latest UK Job Market Report from Adzuna.co.uk.

April saw 12,850 vacancies advertised for entry-level roles, 8.0% lower than the 15,305 positions on offer in April 2015. This dip comes as cautious employers stall hiring across the UK, with the number of total advertised vacancies standing at 1,156,810 in April, 0.3% below the 1,160,058 available in March. Concerns about the ongoing impact of last month’s new National Living Wage and the upcoming EU Referendum could be responsible for this reduction in new roles. In a further sign of a jobs market slowdown, previous employment improvements, including in vacancy numbers and salaries, have halted. The latest ONS Labour Market Statistics reveals a 5.1% unemployment rate – unchanged from the previous quarter.

Graduate pay also took a hit in April, with the average advertised entry-level salary falling to £23,309 – the lowest amount on offer since £22,849 in October 2013. This 30-month low comes alongside a 3.0% monthly drop from £23,941 in March.

April has also seen the UK starting pay drop to £33,462, the lowest on offer for four months, since £33,332 in December 2015. On a monthly basis, average advertised salaries fell 1.0% from £33,815 in March – a dip echoed by graduate starting salaries.

Table 1:

Doug Monro, co-founder of Adzuna, comments: “Graduates are gearing up for their future careers. In university libraries across the UK, students are filling in the job forms and crossing their fingers. But they might need more than luck this summer. Graduate vacancies are falling and new joiners are facing one of the toughest job markets in recent times.

“Many graduates may feel like it’s a rough deal right now. Graduate pay has fallen drastically from 2013 levels, and talks of rising tuition fee hikes next year will only add to this feeling. Unfortunately, fewer roles does inevitably mean more competition to find a first job – but graduates may have the upper hand in the long-term. Many of these schemes contain a long-term investment in development and fast-tracking to managerial positions. So graduates may yet have the last laugh.”

Oxbridge towns the best graduate job hunting ground

Cambridge and Oxford are leading the way as the best places for new graduates to find work. In Cambridge, April saw just 0.08 jobseekers per vacancy, the equivalent of 8 jobseekers for every 100 vacancies. Oxford saw 12 jobseekers for every 100 vacancies (0.12) – creating a South East hiring stronghold.

Meanwhile, job competition has improved in April, reducing to 0.54 jobseekers per vacancy, from 0.56 the previous month. This has eased 29.9% from the 0.77 jobseekers per vacancy rate in April 2015. Further to this, 41 out of 56 UK cities currently have more positions available than jobseekers.

Doug Monro, co-founder of Adzuna, comments: “Graduates keep gravitating towards the bright lights of London. The capital has always held a charm for those fresh out of university and filled with ambition. But sometimes moving to the capital isn’t the wisest choice.

“London has many jobs and is a hub for many industries. But competition is getting tougher in the capital and graduates may be missing out on other fantastic opportunities. Cities like Cambridge and Oxford offer a great alternative – less competition and easy access to London. Start-up companies are branching out from the capital and this is the adventurous approach graduates should adopt too.”

Northern Ireland the only region to see salary rise

April saw all regions except Northern Ireland witness falls in average advertised salaries. Advertised salaries in Northern Ireland rose by 0.1% to stand at £29,949. For Scotland, average salaries on offer dropped to £31,537 – also falling below the England and Wales Average.

Table 2: UK regions by declines in advertised salaries

Doug Monro, co-founder of Adzuna, comments: “Salaries are struggling to kick-start properly as we leave spring and approach summer. There were high hopes the start of the year would see strong salary growth but so far it’s looking unlikely. But at least one region is seeing jobseekers offered a fair starting salary – Northern Ireland. Meanwhile, job hunters in North East England may find it a challenge to find the right job, with the right salary. Industries in the region may have been hit by manufacturing cutbacks but fears of a potential Brexit may be making employers nervous and salaries for new starters are the first expense to be minimised.”          

Creative sector clambers up the salary ladder

The creative and design sector has entered the biggest improvers table for average advertised salaries, climbing to £31,524 in April – up 4.7% from £30,115 the previous year. Domestic help and cleaning jobs led the way however, with a staggering 44.7% annual increase in average advertised salaries to £26,789, up from £18,516.

Table 3: Biggest improvers – job sectors by average salary

For the Energy, Oil and Gas Sector however, April proved a bad month for salaries. The average advertised salary declined to £36,701 – falling 14.2% year-on-year. Legal Jobs followed closely behind.

Table 4: Worst Decliners – job sectors by average salary

Doug Monro, co-founder of Adzuna, concludes: “Creative and Design jobs are evolving in importance. As the business environment becomes more competitive and global, branding is becoming even more important. And employers are placing more value on strong design skills and the creative abilities of potential employees. The sector isn’t known for being the best paid, but it is picking up. Employers are prepared to put a high price on creative spark.”