Students set to face toughest job market in years post-graduation

Britain’s graduates are set to be leaving universities facing the toughest job market in years, with fewer openings, greater competition, and lower wages seeing graduate salaries falling in real terms.

An Institute of Student Employers’ (ISE) survey this year has shown the median salary reported for graduates is currently £32,000. This has been a significant drop in real terms from £35,993 in 2020-21, though the average did rise by 3 percent from 2023.

The highest record of applications per job since the ISE first started collecting data in 1991 have been recorded this year.

The current job market is tough for graduates, with a considerable jump in applications per vacancy

Stephen Isherwood, Joint chief executive of ISE

Joint chief executive of ISE, Stephen Isherwood, has said: “The current job market is tough for graduates, with a considerable jump in applications per vacancy.”

Rising tax burdens, soaring inflation, and declining pay are feeding into a vicious cycle, with employers offering fewer graduate jobs for fear of being unable to find suitable candidates.

For graduates who are looking for significantly higher starting salaries, the most generous salaries are those offered by investment banks, law firms, and consulting firms.

An annual review on the Graduate Market early this year, by High Fliers Research, noted that if the graduate starting salaries of £29,500 paid by the country’s top employers a decade ago had stayed in line with inflation over the past ten years, graduate salaries now would be approximately £38,800.

That is almost £5,000 more than the median pay for new graduates in 2024.

However, 2024’s graduates are not the first to face growing career difficulties, as the previous few years have seen a decrease in job postings for graduates.

Last year, Reed Recruitment found that available positions for graduates were 40% below 2018 levels, with pay also declining.

James Reed, CEO of the Reed group of companies, responded: “The situation for recent graduates is definitely worsening.”, adding “real wages have been squeezed across all sectors, and graduates are no exception.”