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Job openings for UK graduates are at their lowest level since 2018 as employers hold off hiring and seek to cut costs by using AI, according to new data.
Indeed, the job search site, said the number of roles advertised for recent graduates was 33 per cent lower than a year ago, and had fallen 12 per cent as a share of all job postings.
The wider labour market has continued to weaken since tax and minimum wage changes introduced in April pushed up the costs of employment. Indeed’s figures for overall job postings in mid June were 5 per cent lower than at the end of March.
This makes the UK an outlier compared with the US and European peers, Indeed said, as it is now the only economy with fewer job openings available than before the pandemic.
The figures are likely to reinforce worries among UK policymakers that the jobs market could be on the verge of a sharp downturn, rather than the gradual softening the Bank of England expects and thinks is needed to relieve wage pressures and bring inflation back to target.
Dave Ramsden, a BoE deputy governor, said at an event in London on Tuesday that he voted to cut interest rates last week — dissenting from the majority decision to leave them unchanged — because of the “cumulative evidence of a continued material loosening in the labour market”.
So far, this has been a gradual process, he said, but he pointed to a rise in online searches for “redundancy” and a drop-off in the rate of unemployed people finding work as potential warning signs of a “more substantial weakening”.
Indeed’s figures show job postings are now 21 per cent below their pre-pandemic baseline — which Ramsden referred to as a time when the jobs market was “broadly in balance”.
Jack Kennedy, economist at Indeed’s Hiring Lab, said the figures still pointed to a “gradual softening rather than a nosedive” in the overall labour market, in contrast with gloomy predictions at the start of the year about the impact of the tax and minimum wage changes.
But anyone looking for their first job faced a tough environment, he added, with employers showing “a reluctance to hire new staff and an inclination to hang on to existing ones.”
Kennedy said the figures also raised the question of how far employers were now accelerating the use of AI to perform tasks that had previously been given to entry level workers — with rising labour costs spurring them to explore ways to automate these early career roles.
Although April’s policy changes hit low wage sectors such as retail and hospitality hardest, the deepest slump in hiring has been in professional occupations, Kennedy said.
Indeed’s figures show job postings are now 27 per cent below their pre-pandemic level in human resources and project management; 37 per cent lower in marketing and 48 per cent lower in media and communications.
