This has been a pretty downbeat year, so let’s try a bit of optimism. Let’s imagine it’s early summer 2021. A vaccine is being rolled out, and we’re looking at a UK economy that is starting to think about a post-vaccine future.
The economy is growing. The restrictions we are looking at now are less stringent. More workers are going back to their workplaces. There is some respite for our retail and hospitality sectors. This is, essentially, the central assumption of the most recent economic projections for the UK.
For young people starting out in their careers, we can’t assume an automatic return to normal. But by looking at what happened to the last graduating cohort pre-pandemic there are some clear signals that help us to predict what they may find.
Prospects at Jisc’s annual What do graduates do? report, created in partnership with AGCAS, analyses graduate destination data to help advise and inform student career decisions. It is an indispensable resource for employers, policymakers and education providers.
The 2020 issue is based on HESA’s Graduate Outcomes data, which surveyed 2017-18 graduates 15 months after they had left university. But in a year of such disruption, what are the lessons we can learn to help us to understand a post-vaccine graduate labour market?
Six per cent graduate unemployment rate would signal recovery
Under normal circumstances, we’d expect an early unemployment rate of between five and six per cent for graduates – unemployment stood at 5.5 per cent for 2017-18 graduates. It may take some time to settle down to that level but once it comes back to around six per cent we can consider the graduate labour market to be in a state of recovery.
Postgraduate study will stabilise
Twelve per cent of 2017-8 graduates were in further study and in total about 18 per cent had taken a postgraduate course since graduation. We expect the figures for the next couple of years to be a little higher as postgraduate study always increases in a more difficult labour market – and that will still apply even if the UK is not technically in recession.
Earlier this year more than a third (36 per cent) of 2020 finalists surveyed by Prospects indicated that they plan to remain in higher education rather than start their careers. As the economy starts to recover, entry to postgraduate courses should start to stabilise at a rate that looks similar to 2017-18, assuming no overt policy drivers to increase postgraduate study and address certain labour market issues, such as increased support for career changers.
Fewer self employed
Self employment has been badly hit by the pandemic, especially in the crucial arts sector. Normally around four per cent of graduates are solely self-employed, but it’s closer to eight per cent once all graduates who have some form of self employment as one of their activities are taken to account. This may be impacted next year and until the arts recover, but we’d expect about three ot four per cent of new graduates to be self-employed as their main activity in 2021, which is the level we see in a trickier economic environment.
Little change in top five jobs
The most common jobs for graduates from 2017-18 were (in order) nurses (9,800), marketing (4,575), sales assistants (4,305), primary and nursery teachers (4,295) and programmers and software developers (4,160). Most of these roles have been relatively lightly affected by the pandemic, so we’d expect numbers to largely hold up – except for sales assistants.
The top five most common jobs are relatively consistent. It will be interesting to see whether a different role will enter the list next year, probably at the expense of sales assistant. Doctors or secondary school teachers look to be the most likely for 2021.
Disrupted graduate migration trends
Sixty six per cent of 2017-18 graduates went to work in their home region of the UK. Will the rise of remote working mean that graduates become ostensibly more mobile and more willing or able to take jobs with employers based further afield? Or will graduates opt for familiar surroundings in an uncertain labour market? And London’s jobs market has been the most affected of all the UK – will this reduce the proportion working in the capital?
Data and evidence can help us to gain a glimpse of the future, but only time will really tell. It’s vital that we use this information along with the latest labour market information to help, guide and advise students on their first steps to a brilliant career.
One response to “What might the graduate labour market look like in 2021?”
Great insights as always Charlie. Thank you for sharing….