The impact of a recession on students

The United Kingdom is officially facing its deepest recession in recorded history as a result of the coronavirus pandemic. The effects of this will most likely be felt by everyone. Across the country unemployment will likely increase, businesses will suffer and may potentially go under, house prices may fall, and we might even be heading towards a new era of austerity.

Inevitably the recession will have a profound impact on students and recent graduates. Back during the 2008 recession the biggest issue students faced was graduating into a graduate job market that was even more competitive than what it was outside of a recession. This issue will likely also be faced by graduates during this recession. As companies and businesses start to suffer, they will simply not hire as many graduates, choosing instead to prioritise keeping on existing staff.

28% of graduate jobs have been cancelled or deferred due to the pandemic this year

A survey carried out by Prospects found that 28% of graduate jobs have been cancelled or deferred due to the pandemic this year. This will have a knock-on effect on next year’s graduate job market as well, with this year’s graduates who lost jobs competing with next year’s graduates for coveted graduate jobs that are likely to still be in short supply. This will inevitably lead to some graduates taking any job they can get, even if they are overqualified. The cancellation of many internships this year may also harm the prospects of next year’s graduates. Yet, there is hope that employers will take this in to account and not penalise students who have been unable to secure internships due to the pandemic.

I know this all sounds very bleak, but there is reason to remain positive. At the moment the government are not considering increasing tuition fees or reducing maintenance loan amounts. Yet, students who rely on parental support on top of their maintenance loans may struggle if their parents’ finances have been significantly impacted by the recession. This may cause an increase in students searching for part-time work. Though with graduates taking any work they can get and with people who have lost their jobs happy to do anything just to put food on the table, the part-time job market is likely to become increasingly crowded as well.

International students will likely struggle more than domestic students when it comes to the cost of living at university

The Chancellor of the Exchequer, Rishi Sunak, announced back in July a job creation scheme for under 25s. This will six-month job placements for roughly 350,000 unemployed 18-24-year olds. This may help some students and graduates find work they would otherwise be unable to get. Yet, it is sadly inevitable that some people will be left behind.

International students will likely struggle more than domestic students when it comes to the cost of living at university. Many international students rely on parental support for all their day to day living costs due to the lack of government support. If their parents’ incomes have also been hit by the recession, which is having a large impact in many countries, parents may simply be unable to afford to support their children.

Recessions have traditionally led to greater innovation and an increase in start-ups who capitalise on the changes that recessions bring to society. Though at the moment the recession will not seem like a good thing at all to most students and recent graduates, you could just find yourself working for the next big start-up or even starting up something of your own. Rishi Sunak attempted to reassure people that ‘we will get through this, and I can assure people that nobody will be left without hope or opportunity’. It may not seem like that now. Yet, the recession provides you with the golden opportunity to explore paths that you would never have dreamed of pursuing, and may just end up finding your dream path.