Graduate employment has fallen back to pre-Covid levels as a weakening economy depresses hiring, erasing a temporary post-pandemic boost in opportunities, according to a new study from Prospects at Jisc.
The annual What Do Graduates Do? The report, released Nov. 25, shows a significant deterioration in outcomes for the 2023 graduate cohort, which entered the labor market at a time of declining demand and was surveyed in fall 2024 when conditions continued to deteriorate.
Only 56.4% of graduates were in full-time employment 15 months after graduating from university – 2.6 percentage points fewer than the previous year and the lowest rate since the cohort that graduated immediately before the Covid recovery boom in 2020. The decline continued until 2025.
Charlie Ball, head of labor market intelligence at Jisc, said post-pandemic hiring conditions had created “unrealistic expectations”.
“Many assumed the strong post-Covid job market was normal, but that really wasn’t the case,” he said. “After several years of post-COVID exuberance, we have now returned to normal labor market cycles. Job vacancies are declining, companies are uncertain and with the AI bubble about to burst, a recession appears imminent.”
The unemployment rate among college graduates also rose from 5.6% to 6.2%, but is still well below the general youth unemployment rate of 15.3%.
One of the most notable changes is the decline in the number of graduates taking on IT roles. Only 5.1% of the cohort moved into tech jobs – down from 6.7% – reflecting a sharp decline in IT job vacancies as the sector recovers from over-recruitment following the pandemic.
The number of graduates taking up non-degree administrative roles fell significantly, with retail once again the largest destination for non-degree jobs – a return to long-term pre-Covid patterns.
After a prolonged slump during the Corona crisis, self-employment has recovered strongly, rising from 8.8% last year to 11.4%.
Despite the weakening labor market, the ongoing skills shortage continues to drive demand in key sectors. Engineering, IT, health and social care remain in high demand, with top graduate positions filled by nurses, programmers, doctors, teachers and marketers.
Ball urged graduates not to be discouraged, noting that those with higher education still perform significantly better in recessionary job markets.
“Most graduates get good jobs pretty quickly, and it will stay that way,” he said. “But the process will be tougher and more competitive. Students need strong support from career services – and they shouldn’t get lost in the AI hype. At this point there is little evidence of widespread job loss due to AI, and the industry still needs people who can use these tools with human judgment.”
