In the early 1990s when the country was in the depths of a brutal recession, an anxious graduate in a construction industry Q&A asked a leading HR manager where all the jobs were. The manager replied that there was simply nothing being built, no confidence in the market, and opportunities would be few and far between. The panel echoed his warnings.
I met that same HR manager ten years later, and he rued the permanent three-year talent gap hardwired by their not hiring graduates and apprentices in the depths of the early ‘90s recession. There were no experienced, qualified professionals available, not even to poach from a competitor. The industry was running with one hand tied behind its back.
The UK is now a very different country and economy. We are not seeing such widespread lay-offs, nor the hemorrhaging of business confidence. Businesses have handled Covid and the disruption it brought, and we still have a huge demand for talent, which has grown as the baby boomer generation accelerate their departure from the labour market.
With the combined impacts of the war in Ukraine, the rising cost of living and reduction in consumption, the overall economic picture can seem very daunting, but all is not lost for recent graduates. We will not be entering a potential recession with high and structural unemployment.
So why should graduates be cautiously optimistic? Up to a million workers have not returned to their jobs post-Covid and they are unlikely to return in significant numbers. This has coincided with the impact of the UK leaving the EU and changes to freedom of movement. An almost unlimited pipeline of talented, skilled and relatively cheap graduates from across Europe has been closed, exacerbated even further by Covid.
Covid also highlighted the vulnerability of the UK economy to large, global supply chains, and there is now even more nervousness due to the global tensions that have arisen in 2022. Many companies are looking to move a greater part of their supply chain to the UK, representing great opportunity, and challenge, for the future labour market.
Employers are facing a loss of experienced staff, a significantly reduced labour market to recruit from and a need to upskill their workforce because of changing business needs and the pace of innovation. Employers need to grow their own talent because supply is limited. There will be economic shocks and surprises, but I am confident that this recession will not have the same impact on graduate recruits as the previous recession. Graduates and school leavers should maintain their ambition and not feel disheartened – they are very much needed.
October 5, 2021
September 29, 2023