Is it a false economy to pull out of graduate sponsorship?
If a company wants to know its graduate recruits rather better than may be allowed by a couple of 'milk round' interviews, the obvious course is to sponsor potential employees through university. It's a costly solution though and, not surprisingly, less widespread than it used to be. But graduate sponsorship still has its adherents - Arthur Andersen, British Airways, BOC, Sainsbury and ICI among them.
Sponsorship ensures that the recruit has some knowledge of the company as well as a degree in a relevant discipline. Under the normal arrangement, the company pays the undergraduate a bursary during the academic year. In return, students work, paid, for the company in some of the academic holidays. And at the end of the course, the company - which has been following the student's progress - usually but not invariably comes up with the offer of a job. Sponsorship levels range from a few hundred pounds a year up to the armed services' decidedly immodest £7,000-£10,000.
Is it worth it? At first glance it seems that the employer has everything to lose. The student not only gets free funding during term time, but is assured of a reasonably well paid holiday job - better than work on the local strawberry farm. On graduation the student is under no obligation - other than a moral one - to work for the company. According to the Sponsorship for Students guide (published by Hobson's), the overall retention rate at this stage is about 60%.
The number of companies prepared to offer sponsorship for the whole three years has dropped sharply during the 1990s - from over 200 to around 30, according to Monica Wilson, the guide's editor until this year. But while this decline is partly due to recession, it also reflects the growing number of firms which now sponsor students for the final two years only, when course changes are no longer an option.
Barclays, for example, offers sponsorship and work placement to suitable students from the second year onward. BOC is a shade more cautious, and supports final-year undergraduates only. The company offers work to students during a sandwich course 'industrial year', explains graduate recruitment manager Brian Tordoff. 'Of these, perhaps half a dozen - who have impressed us and have expressed interest in a career with us - receive sponsorship in their final year.' Arthur Andersen, by contrast, still goes the whole hog. The firm will sponsor appropriate candidates, regardless of subject, for an entire course, plus a 'gap year' before university during which it provides eight months' employment. Steve Lee, UK director of recruitment, maintains that this arrangement 'has certainly given us access to a greater number of high fliers than we would see using traditional methods of graduate recruitment'. Lee points to an impressive retention rate of around 75%. He also claims that the 'scholars', as they are known, represent excellent publicity for Andersen.
Despite the recession, some companies are happy with sponsorship, and regard the wastage - of those who turn out to be unsuitable or unwilling to join - a price worth paying. The armed forces take a sterner view, however. Come graduation, if the young officer no longer finds five years in uniform appealing, then it's payback time.