Employers 'prejudiced against new universities'

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Labour Editor

Employment prospects for graduates are poor and likely to get much worse, with job-seekers from the old polytechnics facing the added disadvantage of "in-built prejudice" from employers.

The number of degree-holders is set to increase by nearly six times more than the available jobs, according to an annual study of employment opportunities published today. While the number of graduates next year is expected to increase by 14 per cent, vacancies are likely to rise by only 2.4 per cent, Industrial Relations Services has found.

In a survey of nearly 200 organisations employing more than 1 million people, more than a quarter of employers said they expected to cut graduate intake next year.

As part of a "remarkable" change in the market for degree-holders, the biggest recruiters were the most likely to predict lower vacancy levels. More than 40 per cent forecast a lower intake. Small and medium-sized enterprises are taking an increasing proportion of university output.

The authors say that the "massive shake-up" in higher education in the last few years has led to a dramatic increase in the quantity of new graduates entering the market.

There is now an unofficial "two-tier" approach by employers, the IRS Employee Development Bulletin found. In contrast to previous surveys, there was an in-built prejudice against the new universities.

An increasing number of employers felt the old polytechnics were producing low-calibre graduates. Equally worrying was the fact that most employers felt the teaching at new institutions was not more relevant to business.

More than a third of respondents reported dissatisfaction with graduates' business awareness - a substantial increase on last year's finding.

The report said that starting salaries reflected employers lack of confidence. This year's average starting pay was pounds 13,959 - a rise of only 3.3 per cent on 1994. The prediction for next year is 3.2 per cent, below the expected rate of inflation.