Almost half of employers slash hiring of graduates

Almost half of employers slash hiring of graduates as experts warn of a widening gap between rich and poor during ‘K-shaped’ economic recovery

  • Almost 40% of firms say they will slash their intake of graduates, research finds
  • 60% of employers have cancelled work experience placements due to pandemic
  • Sutton Trust says youngsters will ‘bear the brunt for years’ of Covid-19’s impact 
  • ‘K-shaped recovery’ would improve things for ‘haves’ but worsen for ‘have-nots’

Young people are facing a coronavirus jobs nightmare after almost 40 per cent of firms said they would slash their intake of graduates, research has found.

Over 60 per cent of employers have also had to cancel work experience placements due to the pandemic, social mobility think tank the Sutton Trust said.

The report said youngsters will ‘bear the brunt for years’ of the impact Covid-19, but it urged business to think about the long-term impacts of shutting them out.

It comes amid reports Britain is facing a ‘K-shaped recovery’, where the recently unemployed face further hardship but the employed’s fortunes continue to improve. 

Britain is said to be facing a ‘K-shaped recovery’, where the recently unemployed face further hardship but the employed’s fortunes continue to improve

Young people are facing a coronavirus jobs nightmare. A graduate jobs fair is pictured above

The Trust said that despite Covid precautions, firms must ‘work to keep the pipeline into their industry open, including where possible moving experiences online’.

Businesses must also ‘redouble efforts to open up opportunities to the best talent’, in order to try and stop those from disadvantaged background being penalised.

How Britain’s economy could be facing a K-shaped recovery 

Britain’s battered economy could be facing a K-shaped recovery – where things improve for the ‘haves’ but get worse for the ‘have-nots’.

Experts fear unemployment could rise to 10 per cent by the end of the year after the Government’s furlough scheme ends, meaning blue-collar workers and small businesses will experience further economic trouble.

But white-collar workers, who have mostly avoided redundancies and been working from home during the lockdown since March, will benefit from saving more and spending less.

It comes as the Treasury and Bank of England try to encourage a rapid V-shaped recovery instead of a more prolonged L-shaped bounceback.

Speaking about the K-shaped recovery, Paul Dales, chief UK economist at Capital Economics, told the Daily Telegraph: ‘The upward leg is the ‘haves’ who have kept their jobs and the downward leg represents the ‘have nots’ who have lost theirs.

‘I can’t quite think of any recession which has had such a big difference on people’s incomes. 

‘Some people are sitting there with piles of cash in the bank and others will be wondering how they are going to buy food. The aggregate picture disguises a massive difference.’  

According to the think tank’s YouGov poll, small and medium sized enterprises (SMEs) were the most likely to have cancelled all internships and work experience placements, with half (49 per cent) doing so.

Almost half of 1,000 surveyed employers (48 per cent) expect that there will be fewer work experience opportunities in their businesses over the next year.

Meanwhile, 39 per cent of graduate employers report they are likely to be hiring fewer graduates or none at all in the next 12 months.

The worrying research states: ‘The economic impact of the pandemic will have considerable and lasting consequences for social mobility, with the economic downturn likely to widen existing inequality, and increase the number of children in households growing up in poverty.

‘As the Trust have demonstrated throughout this COVID-19 impact series, from early years, through to schools, apprenticeships, access to university and into the world of work, the crisis will impact on disadvantaged young people through every life stage.

‘It will take a concerted effort, from all parts of society, to lessen this impact and ensure all young people have an equal chance to showcase their talent and potential.’

Sir Peter Lampl, founder and chairman of the Sutton Trust, said: ‘It is crystal clear that young people will bear the brunt for years to come of the massive downturn caused by Covid-19 – and young people from poorer backgrounds will be most affected.

‘As our latest research shows, 49 per cent of students believe the pandemic has affected their chances of getting a job and 40 per cent of employers say they’ll be hiring fewer graduates, or none at all.

‘Employers will need policies in place to allow everyone a fair chance of being recruited to the lower number of graduate jobs available.

‘As internships and work experience placements are declining, employers need to move their programmes online. We need to act now to make sure that all young people have opportunities to enter the labour market.’  

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