Official statistics released last week showed 946,000 people aged 16 to 24 were not in education, employment or training at the end of September.
Britain’s graduate jobs market has taken a sharp turn for the worse, with the number of university leavers still out of work more than a year after finishing their studies rising by 8,000 in just twelve months.
The figures add to growing concerns that Labour’s economic decisions are hitting young people hardest.
Prospects at Jisc reported that 56,900 graduates from the class of 2023, 6.2 percent of the cohort, remained unemployed 15 months after leaving university. This is up from 48,700, or 5.6 percent, for those who graduated the year before. The increase highlights how entry level opportunities have dried up across the Labour-run economy.
Labour’s tax rises blamed for hiring slowdown
The deterioration follows the Chancellor’s decision in last year’s Budget to raise employers’ National Insurance contributions and increase the minimum wage, measures that many businesses say have added to their costs. Companies are widely understood to have burned through their recruitment budgets earlier than expected, leaving fewer openings for graduates as the financial year progressed.
Analysts at Jisc have indicated that the pattern of rising graduate unemployment resembles the early signs of a broader economic downturn, one that appears to have accelerated under Labour’s stewardship. Historically, rates of 7 to 8 percent among university leavers are common during recessions, raising fears that the country may be heading in that direction.
Youth worklessness climbs under Labour
The graduate figures come alongside bleak news for young people more generally. Official statistics released last week showed 946,000 people aged 16 to 24 were not in education, employment or training at the end of September. The rise in youth disengagement has intensified concerns about Labour’s handling of the jobs market.
Data from the Higher Education Statistics Authority shows that only 56.4 percent of 2023 graduates were in full time work 15 months after completing their degrees, down from 59 percent for the previous year’s cohort, suggesting conditions have worsened since Labour took office.
Tech sector cutbacks continue, with AI worsening competition
The technology sector, once a reliable destination for well-qualified graduates, has seen one of the steepest falls. Only 5.1 percent of 2023 university leavers managed to secure IT roles, compared with 6.7 percent the year before. Many tech companies, having over-expanded during the pandemic, have scaled back hiring dramatically.
AI tools have also reshaped recruitment, contributing to a surge in applications and making it more difficult for employers to identify genuine talent. Recruiters say the sheer volume of near-identical applications has increased the strain on already cautious employers, adding to the challenges faced by first-time jobseekers.
Experts warn that the UK’s graduate jobs market is unlikely to improve significantly over the next year, noting that hiring across the wider economy has stalled during the summer months. Graduates entering the workforce under Labour face a tougher and more competitive environment than those who came before them.
The broader jobs market also continues to shrink. The Office for National Statistics reported that vacancies fell to 723,000 in the three months to October, down from 822,000 in the same period a year earlier, further evidence of a cooling economy since Labour took charge.
The Department for Work and Pensions was contacted for comment.
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