- One in seven (15%) entry-level candidates unemployed in a given year (140,000 young people)
- Majority of employers (70%) plan to increase entry-level recruitment in the next five years
- Graduates account for only a third (33%) of those entering the labour market
- Research by totaljobs.com and IPPR the most comprehensive study of entry-level labour market
One in seven British employers has been unable to fill an entry-level role in the last three years, according to one of the most comprehensive reports into youth employment. The report, released today by totaljobs.com and conducted by IPPR, reveals a serious skills mis-match in the entry-level labour market.
The report also reveals the entry-level unemployment rate for the very first time, which is 15% (one in seven). The unemployment rate for all qualification levels rose following the recession – around 140,000 entry-level workers are unemployed in a given year of the post-crash period.
However, the unemployment rate is higher for those with fewer qualifications. While 16% of those with degrees and A levels are unemployed and only 5% of those with trade apprenticeships, unemployment rates jump to one in five for those with good GCSEs at A*–C (20%) and almost one in three with lower grade GCSEs at D–G (28%).
UK labour market insights – the entry-level dilemma was conducted by IPPR on behalf of totaljobs.com and is the first comprehensive study of its kind into the entry-level jobs market. Entry-level candidates are defined as workers aged 16–24 who have gained a qualification and left education in the last year.
Each year, 890,000 young people start their search for work after gaining a qualification. Interestingly, graduates account for only a third (33%) of those entering the labour market and instead more than two-thirds of entry-level workers – the ‘forgotten 60%’ – have other qualifications.
In the last year, nearly half of employers (48%) have attempted to recruit entry-level workers. Of the one in seven that struggled to fill roles, nearly half (43%) cite a lack of basic employability skills, like literacy and numeracy, as a cause. A quarter also said a lack of basic education in core areas such as English and mathematics was a factor in why they did not recruit at entry-level.
Over the next year, firms expect to cut back on entry-level recruitment, with more employers planning to reduce the number of places they will offer than to increase them. Although over the next five years, 70% more employers expect to increase entry-level recruitment, rather than cut back.
James Frearson, totaljobs.com, said: “This report shows a serious mis-match between the skills held by entry-level candidates and those demanded by employers. As employers expect to increase their recruitment of entry-level candidates in the next five years, this issue would need to be addressed by the government and employers as priority.
“There are a number of things employers can do to help entry-level candidates prepare for the world of work, such as providing more opportunities for candidates to learn about what is expected of them in the workplace. Paid work experience placements to those still in education, and more investment in on-the-job training and apprenticeships are a great place to start. Recruiters can also help by simplifying their application processes, with a clear selection criteria and constructive feedback for unsuccessful candidates.”
Spencer Thompson, senior economic analyst at IPPR, said: “There has been much discussion in recent years on the subject of ‘the Forgotten 50%’, those young people that do not progress to degree-level study. Our report highlights that in fact more than 60% of those in the entry-level job market are not graduates, and that those leaving school with qualifications below A level are faring much worse in terms of unemployment in their first year after education.
“The government must do more to address this imbalance and the skills mis-match highlighted by this report. Although work has been done by this government to increase the number of apprenticeships available, participation in these schemes by under-25s remains low. This is despite high entry-level employment rates for young people who have taken this route, at 95%. The Department of Business, Innovation and Skills, which oversees skills funding, should look at how it can better target apprenticeships at school-leavers.”
The report also reveals that more than a third of entry-level workers with a degree find a job in highly skilled occupations, compared with just over one in ten of those with A levels. More than a third of apprentices are in the skilled trades, working typically as electricians and plumbers, or in construction roles. A quarter of those without five good GCSEs also find a job in these occupations.
There is also a concentration of entry-level workers in the personnel and customer service categories, and 40% of employed entrants with A levels and slightly less than a third of those with GCSEs work in the retail and hospitality sector.
However, there is an over-representation of entry-level workers in manufacturing at apprenticeship and lower qualification levels, relative to the overall share of this sector across the whole workforce. While manufacturing is shrinking overall, many workers in the sector are approaching retirement and this appears to be leading to robust demand.