And it’s not looking any brighter for students this year either. IDS said there were 44 applicants for every graduate vacancy in 2010, up 25% from 35 in 2009, and warned that this could increase this year as a backlog of unemployed graduates come back for a second round of job hunting. Such competition means that employers are under little pressure to increase current rates: starting salaries are set to increase by another 1% this year to an average of just over £26k, but more than two out of three employers plan to freeze graduate recruitment altogether.
Seems like our poor beleaguered students need something to make them feel good, without having to place traffic cones in incongruous locations or lob fire extinguishers around. So we can only hope for more initiatives like the one announced by software and services company Microgen, which is offering to help its new recruits attempt the impossible: actually paying off their student loans.
The new scheme, which kicks off this month, involves Microgen matching the monthly contributions of all its UK university graduates who are repaying their student loans via employer deductions, up to £250 a month. Microgen isn’t the first to do this, but the fact more companies are choosing to get on board with such schemes shows that there's an increasing recognition of the financial risk that going to university now involves.
You can see why. As if the debt burden on young British graduates entering the workplace wasn’t already crippling enough, things are going to become increasingly tight with the forthcoming changes to tuition fees. And while they’re trying to get their daytime TV-addled heads around that, fresh grads will also be attempting to get a foot on the increasingly unstable property ladder, while battling with rising living costs and taxes. So a potential extra £3k a year is certainly not to be sniffed at. Plus it helps the companies concerned to stand out from the crowd at milkround time, of course.
But Microgen hasn’t just been chucking its money around. It’s also written to the Department for Business, Innovation and Skills with suggested ways to encourage more employers to adopt similar schemes. As the company says, the DBIS puts ‘creating a highly skilled workforce’ as one key way it’s contributing to the enterprise culture. But if the result of higher tuition fees is that fewer people end up going to university, at a time when the demand for higher-level skills within UK plc is rising, we could find ourselves in a spot of bother before too long.