ISE: Apprenticeships Rise As Graduate Vacancies Drop 8%. Apprenticeship Hiring Increased By 8%

Employers are rebalancing entry-level recruitment to meet skills demands, reducing graduate vacancies while increasing investment in apprenticeship roles, reports Institute of Student Employers (ISE).

Apprentice Hiring Increased By 8%

The Student Recruitment Survey 2025 of ISE members – large employers offering formal graduate and apprenticeship programmes – found that graduate hiring had fallen by 8% year-on-year, yet apprentice hiring increased by 8%. Graduates still outnumber apprentices and therefore the overall entry-level job market is down 5%.

Overall, employers who recruited students onto both pathways, hired 1.8 graduates for every apprentice this year, which is down from 2.3 in 2024. Projections for next year suggest the ratio will decline further to 1.6:1.

This is the first time graduate jobs have fallen since the 12% decline during the pandemic in 2020. Apprentice recruitment has been in a state of growth since ISE started collecting this data in 2015.

This reflects the role of large levy-paying employers with greater resources to develop and manage apprenticeship schemes, bucking the wider market trend. Government data reports only a 0.6 % rise in apprenticeship starts among 19- to 24-year-olds over the past year.

Reprioritisation of roles is also evident in salaries. Over the past decade, graduate salaries have declined in real terms, reflecting a steady erosion of purchasing power. In contrast, salaries for school and college leavers have seen modest real-terms growth.

This year the typical (median) starting salaries reported were £33,000 for graduates (a 2% increase from last year) and £24,000 for school and college leavers (up 3%).

Competition for jobs is intense as the volume of job applications employers receive remains at a historic high.

An Average of 140 Applications Per Graduate Vacancy

Go back two decades to 2002/3, and employers received an average of 38 applications per graduate vacancy. By 2022/3 that figure had more than doubled to 86 per vacancy and for the last two years has been at 140 per vacancy. Competition for roles in retail, FMCG and tourism were the highest at 290 applications for every graduate role.

School Leavers: Employers Received 89 Applications Per Vacancy

The school leaver market is less competitive, although still challenging. On average, employers received 89 applications per vacancy.

Overall, these results indicate that the graduate market is contracting, with fewer opportunities available despite continued growth in applications. However, the apprentice market shows modest gains in hiring amid rising application volumes.

Competition for jobs is driven by fewer roles but also students’ access to new technology, such as LinkedIn’s Easy Apply, which makes it easier for students to apply for more jobs. Many employers have also reduced barriers to applications by not stipulating minimum A-level grades.

As students make greater use of AI in applications, 79% of employers are now either redesigning or reviewing their recruitment processes. The majority (85%) of employers said they had encountered some form of cheating through the application and assessment process.

Stephen Isherwood, joint CEO of ISE commented:

“The balance between graduate and apprentice hiring is shifting for a number of employers as they look to diversify how they get talent into the business to meet skills shortages. This means more opportunities for students to get into the UK’s leading businesses. However, the market is complex. Graduates still outnumber apprentices, and they remain a core element of recruitment.

“This is a tough job market, but this doesn’t mean there’s no hiring at all. Our data shows that 92% of graduate hiring continues as normal. The current situation is difficult, but not as bad as the 2008 financial crash or during the pandemic. Getting a job is a job in itself and firing out many ill-prepared job applications is not the answer, they are more likely to get rejected.

“Employers are looking for candidates who meet the skills and attributes they need, so it’s about tailoring applications to genuinely reflect what you can offer in relation to the role.”