End of ‘Covid boom’ for Early Graduate Employment

A weak economy has returned graduate job prospects to pre-Covid levels, according to a new report by Prospects at Jisc. 

Prospects’ What do graduates do? found a worsening labour market for graduates who had poorer employment prospects than earlier cohorts who benefited from a post-Covid surge in job opportunities. 

Using HESA data, the report published by Prospects shows that just over half (56.4%) of graduates were in full-time work 15 months after graduating, which is down 2.6 percentage points from the previous year. The last time full-time employment fell to this level was the 2020 graduating cohort who were just ahead of the Covid boom.

This cohort graduated in summer 2023, when the graduate labour market was already slowly subsiding and were surveyed in autumn 2024 when the jobs market had declined further. This noticeable decline has continued into 2025.

Charlie Ball, Prospects’ graduate labour market expert and head of labour market intelligence at Jisc, explained:

“Many assumed the strong post-Covid jobs market was normal, but it really wasn’t. The surge has now unwound and a labour market that was strongly outperforming the economy is closely tracking it. We’re returned to normal labour market cycles after a few years of post-Covid exuberance.

“In the run up to Covid, a recession was evident and now it looks like we’re heading that way, perhaps more dramatically. Vacancies continue to fall, businesses remain unconfident and with the AI bubble set to burst, a recession, which looked two or three years away, now looks more imminent.”   

The percentage of 2023 graduates unemployed after 15 months was up from 5.6% to 6.2%, but this is significantly lower than the wider youth unemployment rate of 15.3%.

Prospects found that there was a large fall in the proportion of respondents entering IT roles, who made up 5.1% of the cohort, which is down from 6.7% last year. This reflects the drop in the wider jobs market for IT roles in 2024, which was part due to over-recruitment post-Covid, and is reversing.

There was also a significant dip in graduates going into administrative ‘non-graduate’ roles. This was replaced by retail as the largest non-graduate option, a return to pre-Covid norms.

Self-employment also recovered from the dip during Covid. The proportion of graduates entering self-employment increased from 8.8% to 11.4%.

Long-term skills shortages continue to fuel graduate demand. Engineering, IT, health and social care are high demand subjects.

The top six roles for graduates were:  

1. Nurses
2. Coders and software professionals
3. Doctors
4. Primary teachers
5. Advertising and marketing
6. Secondary teachers

Charlie added:

“A recession labour market is grim, but graduates always fare much better than those without education or training. If you’re considering study, look at skills demands – we need more nurses, doctors, coders.

“Most graduates get good jobs quite quickly, and that will continue to be the case, although that does not mean it will be easy. The process will be tougher and more competitive, and students will continue to need substantial support from careers services. And don’t get lost in the AI hype. At this point, there is not much genuine job loss due to AI and if large job losses do happen, it’s not looking likely to be any time soon. Moreover, industry will want people who are skilled to use AI tools properly while retaining human judgement.”