University graduates in the UK are facing the most competitive job market since 2018. Employers are temporarily halting their hiring plans and turning more to artificial intelligence (AI) to save money. This trend is especially unfortunate for those new entrants to the workforce, with job postings for recent grads down 75%.
According to a new report from job search site Indeed, the number of publicly advertised, entry-level roles for new grads has crashed by a third from this time last year. This net decline represents the lowest point in seven years. Total job postings were 5% below those at the end of March as of mid-June. The picture isn’t all rosy — even the broader job market is experiencing turbulence. Growing employer taxes and new minimum wage requirements implemented this past April add to this burden.
Jack Kennedy, a senior economist at job-search portal Indeed, noted that the overall labor market remains solid. New graduates are having a hard time finding that first job.
“Despite the UK labour market holding out overall, new entrants like graduates face a challenging time in securing a first rung on the ladder.” – Jack Kennedy
The UK is in a peculiarly difficult position. It is the only major economy where job openings today are less than they were on the eve of the COVID-19 pandemic. This loss is a significant challenge for graduates trying to make the jump into the workforce.
In response, Technology Secretary Peter Kyle got right to the heart of the matter. He called on employees and companies to “take action” and adjust to the addition of AI. He warned that if they didn’t adapt they would be further stranded in a rapidly changing labor market. And as sectors continue to adopt AI technologies, workers need to learn new skills to stay in the game.
Kennedy remarked on the potential for current employees to gain relevant skills, stating that no one in employment today is incapable of acquiring what is necessary for success in the next five years. He stands by urgent action to help workers succeed in this new world.
“Act now.” – Peter Kyle
All in all, the trends point towards a further gradual softening of the UK job market, rather than an immediate crashing down. The more serious issue is the dramatic decline in available placements for new graduates, which puts their future access to employment at risk. As economic conditions evolve and AI becomes more prevalent, adaptability will be crucial for both job seekers and employers alike.