Graduate vacancies increase by highest margin in over 10 years

- Graduate level vacancies rise by 16.7%

- Median starting salaries climb to 23,136 ñ an increase of 2.9%

- Recruiters received an average of 28 applications per vacancy

- Team working, oral communication, flexibility and adaptability, customer focus and problem solving most desired skills by recruiters

- 91% of graduates recruited in 2005 season are still with the same organisation

Research announced today at the AGR (Association of Graduate Recruiters) annual conference has found that there has been an increase in both salaries and vacancies, with vacancies for graduate positions higher than any year since 1995.

The Summer AGR Graduate Recruitment Survey 2006 ñ a survey of 235 of the UKís leading employers ñ reveals that graduate vacancies have risen for the third year running, with the number of positions for graduates leaving university this summer up by 16.7% on last year. More than half of the respondents expect recruitment levels to hold firm in 2007.

The growth in vacancies has led to a slight reduction in the number of applications per vacancy ñ with an average of 28 applications received by employers, compared to 33 last year.

Following concerns raised in the AGR Winter Survey released in February this year, the survey investigated in more depth the views of employers on the calibre of candidates. Only 15% felt that the standard of applications had fallen since last year, with more than a quarter feeling the quality was actually higher.

Graduate starting salaries also continue to rise in 2006 to a median on 23,136, compared with 22,000 last year. This is a fairly conservative rise of around 2.9%, just over the rate of inflation. Despite a slight decrease in applications per vacancy, it seems employers are not willing to hike up salaries to attract more graduates.

This yearís survey also addressed the issue of graduate retention, finding that 91% of graduates recruited last year are still with the same organisation. This drops to 75% for those recruited in 2002-03.

The AGR Graduate Recruitment Survey is the definitive bi-annual barometer of the employment situation for graduates in the UK. The survey, carried out by Hobsons, is based on the responses of 235 AGR members ñ many of the UKís largest graduate recruiters in both public and private sectors. The research for this latest report was carried out during May 2006.

Carl Gilleard, chief executive of the AGR, comments, ìThe results of our latest survey show the graduate market is continuing to grow, which is great news for the Class of 2006. Organisations are still seeing the added value graduates can bring with vacancies rising significantly and salaries continuing to grow.

ìHowever, graduate recruiters must not get complacent; a new generation of students with different needs and wants may require a different approach to recruitment and perhaps this slight fall in the number of applications per vacancy may be a warning to recruiters that they need to remain competitive.î

Vacancy levels
For the third year running, AGR employers have increased the number of vacancies on offer to graduates. Vacancies rise this year by 16.7%, the highest since 1995.

Accountancy and professional services firms provided almost one quarter (22.5%) of graduate vacancies in 2006, followed by investment banks or fund managers (18.6%) and engineering (8.4%).

Geographically, almost half (46%) of graduate vacancies were in London, followed by the South East 11.6%) and the Midlands (9.9%).

Starting salaries
For graduates starting positions in 2006, the median starting salary has risen by around 2.9% to 23,136. The highest paying AGR employers in 2006 were investment banks or fund managers who paid a median starting salary of 36,000 followed by law firms, consulting or business services firms, and energy, water or utility companies. The largest percentage increase in median starting salary was the FMCG sector with an increase of around 13%.

Applications
On average AGR employers received 28 applications per vacancy for their 2006 intake, a slight decline on last year. Almost 79% of AGR members anticipate that they will be able to fill all vacancies for 2006.

Fast-moving consumer goods companies again received the most applications with an average of 93 applications per post, followed by the oil industry, which received 66 applications per vacancy.

In terms of skills and qualities sought in graduates, commitment and drive, motivation and enthusiasm topped the list, closely followed by skills such as team working, communication, customer focus, problem solving, flexibility and adaptability. Graduate recruiters felt that computer literacy was the most prevalent skills area but that project management, enterprise, leadership and commercial awareness were the most difficult skill criteria to fill.

Retention rates
AGR members reported reassuring graduate retention rates ñ 91% of last yearís recruits are still with the same organisation. The public sector is leading the way when it comes to retaining graduates over a five year period having retained an impressive 84% since 2001. This is closely followed by banking and financial services (72%) and energy, water or utility industry (69%).