Starting salaries for top graduates will be frozen for the first time in living memory this year, according to a report published today.
The survey, by the Association of Graduate Recruiters (AGR), also predicts the number of job vacancies will fall by 5.4 per cent – the biggest drop for six years. Figures show graduates starting jobs this September are likely to earn an average of £25,000 a year, exactly the same starting figure as last autumn.
Recruitment experts say this will be a bitter blow to the class of 2009, which is the first to graduate with debts as a result of the introduction of £3,000 a year top-up fees.
Some employers, notably banks and financial services, are cutting salaries by up to 8 per cent. Banks predictably estimate the biggest cut in vacancies – around 28 per cent on last year.
But there are encouraging signs – vacancies in engineering and in the public services have risen. This year's drop in vacancies follows a drastic revision of the prediction for 2008 that graduate job vacancies would rise by 11 per cent. The rise was only 0.6 per cent.
Carl Gilleard, chief executive of the AGR, said: "Though we are set to see a drop in vacancies this year, the situation is certainly not as severe as it could be. We saw a sharper decrease in 2003, for example, when recruiters had a negative reaction to the dot.com crash.
"By and large, while no one doubts the seriousness of the current economic downturn, the picture for graduate recruitment, though worrying, could be bleaker. There are even some silver linings with growth predicted in the engineering and public sectors – both of which are likely to appeal to graduates seeking job security this year."
The Higher Education minister David Lammy said: "There are still jobs out there for graduates and going to university is still and always will be a good investment in your future career."
Today's report is based on the responses of 245 of the country's leading graduate recruiters – who employ between them 21,144 graduates.
* Britain's top independent schools today report a rise in applications for this September – contradicting expectations that numbers would fall as a result of the recession.
Figures published by the Headmasters' and Headmistresses' Association – which represents 250 traditional former boys-only private schools such as Eton and Winchester – show a 1.7 per cent rise in the number of 11-year-olds put in for their entrance exams this year. Demand for admission places at age 13 is also up – by 7.5 per cent – and there has been an 8.2 per cent rise in applications to independent school sixth-forms.
The schools attribute the rise to a lack of trust in the Government to run schools. Other commentators suggested parents were putting their children in for entrance tests as they felt their chances of getting accepted were higher.
Bernard Trafford, chairman of HMC and head of Newcastle Royal Grammar School said: "Parents hear that all state schools are to be refurbished and then they hear that this may not happen. They want something that's tried and trusted – and that's what the independent sector offers to them."
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