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10 key trends you should know about graduate recruitment today
What the 2019 AAGE report reveals about the graduate recruitment process and the rewards that await successful candidates.
What is the AAGE Employer Survey report?
Published in October 2018, the Australian Association of Graduate Employers’ (AAGE) Employer Survey 2019 provides a valuable window into the experiences of graduates pursuing entry-level positions at 111 of Australia’s most significant companies. These include:
- Major law firms, such as Allens, Ashurst, King & Wood Mallesons, and MinterEllison;
- Three of the Big Four accounting firms (Deloitte, EY, and PwC);
- Influential consulting agencies, such as Accenture and McGrathNicol;
- Financial giants like ANZ Banking Group, the Commonwealth Bank of Australia, National Australia Bank and Westpac Group;
- Fourteen government departments;
- Multinational resources companies, including Caltex and Rio Tinto; and
- Industry-leading retailers like Mars, L’Oreal, and Coles.
Each company is required to submit data related to four key aspects of the graduate experience: the application and selection process (including preferred assessment techniques and commonly filled roles); recruitment strategies (such as how employers advertise positions or otherwise attempt to reach top candidates); their graduate development programs (with a focus on what employers do to nurture successful applicants); and, finally, aggregated data about the graduates themselves—who applies, which attributes they possess (or don’t), and, perhaps most crucially, how many of them go on to receive offers of employment.
Why does it matter?
In a word, the AAGE report is comprehensive: and this makes it a boon to graduates, many of whom must go through the recruitment process with, at best, a vague awareness of who they’re up against, and of the attributes that employers are hoping to find. We’ve already mined the AAGE report for valuable insights that will give you a competitive advantage when applying for graduate jobs, and also focused on the odds of securing a position in different industries. Here, we zoom out and consider the bigger picture: what are the ten main trends shaping graduate recruitment today? And how do those trends affect you?
By focusing on these broader patterns, you can develop an insider’s awareness of the context within which you’ll be making the crucial first steps towards launching a career. It’s much easier to prepare, and to manage your expectations when you’re equipped with answers to questions like how competitive certain industries are, how structured graduate programs tend to be, and, of course, how much you can expect to earn. As is often the case, Dr Seuss put it best: “the more that you read, the more things you will know; the more that you learn, the more places you'll go.” So, in the interests of ensuring that you can confidently go to as many places as possible, here are the ten top trends you need to know about.
The top ten trends shaping graduate recruitment today
1. Engineering consulting firms, professional services firms, and mining companies continue to hire the most graduates
According to the AAGE report, three industries dominate graduate recruitment when it comes to the number of applications they receive and the number of graduates they go on to hire. Leading the pack in 2018 were organizations in the accounting and professional services industry, each of which, on average, received a staggering 5,949 applications for 225 vacancies (per employer). In second place, the average employer in the engineering consulting industry received 4,387 applications for 139 vacancies (per employer). Rounding out the top three were mining companies, which sifted through 2,673 applications each to fill an average of 44 entry-level openings (per employer).
Other major employers included organizations in the consulting industry, which hired an average of 137 graduates each; the retail industry (74 graduates each); oil and gas (61 graduates each); banking, financial services, or insurance (57 graduates each); and law (54 graduates each).
The industries in which companies, on average, hired the fewest graduates were fast moving consumer goods (11 graduates each); engineering (13 graduates each); and roads and transport (16 graduates each).
Based on the data across all industries, the average employer reviewed 1,940 applications and filled 59 positions, which gave each graduate a one-in-thirty-three chance of getting hired. Encouragingly, while the median number of vacancies per employer had dipped slightly since its peak in 2017 (from 24 to 21), there are still more openings than there were ten years ago, when the median number of vacancies was 18.
2. Businesses are most likely to hire graduates for roles related to IT, finance, and accounting
The AAGE survey asked respondents to specify the types of roles that they were trying to fill during their 2018 graduate recruitment season (i.e roles that would commence in 2019). Naturally, the results are somewhat skewed towards roles that exist both within dedicated businesses (for example, accountants employed by an accountancy firm) and as in-house positions at other companies (for example, as an internal auditor for a technology organization).
Hence, it comes as no surprise that most graduate employers are likely to hire candidates for IT and telecommunications roles, with 50 per cent of all surveyed businesses seeking to fill such positions. Some 45 per cent of employers recruited graduates for finance and economics related positions; 38 per cent for accounting or audit positions; 34 per cent for human resources, learning and development, and psychology related positions; and 32 per cent for analyst positions. Among more industry-specific roles, the most popular were for mechanical engineers (hired by 31 per cent of employers); electrical and electronic engineers (hired by 30 per cent of employers); and software engineers (hired by 21 per cent of employers). Entry-level roles in marketing and legal work were advertised to graduates at about one quarter of all surveyed employers.
At the other end of the spectrum, the least common roles that employers recruited for in 2018 were related to social work (two per cent of employers); agricultural work (three per cent of employers); education (three per cent of employers); and manufacturing engineering (four per cent of employers)1.
For more specific information about different roles, navigate to the GradAustralia advice portal and select the relevant sector. There you’ll find helpful articles like Who’s who in an investment bank? and 13 types of graduate job in the tech industry.
3. Employers are most likely to use websites and online services to reach out to top candidates
Long gone are the days of job postings on university notice boards: now employers overwhelmingly choose to take advantage of online tools. Nine in ten employers describe their own graduate recruitment websites as the most effective recruitment tool at their disposal. However, employers are increasingly likely to use alternative approaches like social media, with 69 per cent finding LinkedIn to be very effective, 46 per cent finding Facebook effective, and 21 per cent finding YouTube effective. Finally, about half of the surveyed employers described the GradAustralia website as a ‘very’ or ‘quite’ effective way to find graduates online.
Of course, employers don’t restrict their recruitment activities to online services. Almost half (46 per cent) of employers visit between one and four universities, with 62 per cent describing careers fairs as an effective way to meet candidates and 59 per cent giving on-campus presentations.
What does this mean for you? On the one hand, with employers expressing a clear preference for online recruitment, it’s essential that you put your best foot forward by managing your digital reputation effectively, optimising your application, and taking advantage of digital recruitment services like GradAustralia’s job directory. On the other hand, few things beat a positive face-to-face meeting with the representatives of a target employer, so check employers in the GradAustralia directory to learn about upcoming careers fairs and brush up on your networking skills to ensure you make a strong first impression.
4. Employers exhibit a strong preference for filling graduate positions with interns
Given that the AAGE report is based on a survey of graduate employers, it’s not surprising that 99 per cent of respondents hired graduates during the 2018 recruitment season. What’s more telling is that 62 per cent hired candidates who had gained experience within their companies while working as interns, summer vacation students, or (in the case of law) seasonal clerks. A further 29 per cent hired graduates who had completed cadetships while simultaneously enrolled at university2.
The industries most likely to hire interns to fill graduate positions were accounting and professional services (each employer made, on average, 145 offers to interns); law (75 offers per firm); oil and gas (35 offers per employer); and engineering consulting (32 offers per firm). The takeaway here is clear: if you’re still in the early stages of your degree, and have a clear idea of where you’d like to work, you should strongly consider applying for an internship. If you’re not sure where to start, then check out the career planning advice on the GradAustralia website.
5. Most employers choose to hire graduates who possess Australian or New Zealand citizenship
A large proportion of graduate employers (46 per cent) describe themselves as 'most likely to consider candidates who have Australian or NZ citizenship or permanent residency'. About a quarter (24 per cent) restrict their efforts to considering candidates with Australian citizenship or permanent residency, while a smaller fraction (16 per cent) only consider candidates with Australian citizenship. Only 13 per cent of employers consider applications submitted by all candidates, including international students.
6. First-year activities are, in most cases, tailored to graduate employees
The good news for graduates who are successful at securing a position with a major employer is that, in most cases, they’ll be rewarded with a program designed to meet their specific needs. Ninety per cent of respondents to the AAGE survey responded affirmatively to the statement: ‘we have a formal graduate development program for graduates entering the business’.
In 45 per cent of cases, this program lasts for about two years (19–24 months), with 40 per cent of programs lasting for less time (21 per cent are over in a year), and only 8 per cent lasting for 36 months. A small proportion of graduate programs (one per cent) last for more than three years, though four per cent of respondents said that their programs have no specific length. Of course, none of these statistics apply if you join the (roughly) one-in-ten organisation that has ‘no specific graduate development program’.
7. Average starting salaries have grown steadily, with the highest still offered by resource-oriented companies
Graduate starting salaries have consistently increased over the past 16 years, from an average of $39,800 in 2003 to an average of $65,691 in 2019. However, there is still a wide gap between the lowest average starting salaries and those offered to graduates in the highest-paying companies.
At the lower end of the spectrum are graduates in the accounting and professional services industries, who, in 2019, will receive an average starting salary of $55,551. Next up are employees in the fast moving consumer goods industry, who will earn an average salary of $60,500. They’re followed by employees of the Australian government ($63,160); the engineering consulting industry ($63,333); the state government ($63,548); and the IT hardware and software industry ($64,091).
Topping the list are organizations in the oil and gas industry, which offer graduate employees a whopping average starting salary of $93,000. Next are organizations in the mining industry ($84,000); law ($75,252); construction and property ($73,200); the engineering contractors industry ($69.000); and the engineering industry ($68,000). Across all industries, the average 2019 graduate salary is $65,691.
Of course, employers don’t rely solely on competitive salaries to attract graduates. Various benefits abound, with 93 per cent of employers offering employee assistance programs (including counselling); 87 per cent offering flexible working arrangements; 68 per cent providing a laptop, iPad, or netbook; 50 per cent covering payment of course fees for further education; and 39 per cent offering free or subsidised sport and leisure facilities.
8. Graduate employers encourage mentoring and buddy programs
The benefits of professional mentoring programs are many and well-known: mentors gain the personal satisfaction of fostering the professional development of somebody new to their industry, while protégés gain access to the skills and experience of somebody who can offer them encouragement, impartial advice, and professional support. However, the advantages go beyond career development: mentors can also help to bolster their protégé’s emotional and psychological wellbeing, with long-term benefits reflected in measures such as higher salaries and promotion rates.
Little wonder then that mentoring and buddy programs rank highly among the development opportunities integrated into Australian graduate programs. According to the AAGE survey, 93 per cent of graduate employers assign new recruits a ‘buddy’, while 79 per cent pair each graduate with a formal mentor. This is great news for ambitious graduates, though, as with most things, the return on a mentorship program tends to be proportionate to your investment of effort and time. So, if you’re not sure how to take advantage of your mentor relationship, here are five quick tips:
- Spend time with your mentor. The best mentoring relationships are built around consistent face-to-face contact, so make sure that you schedule regular meetings with your mentor and then defend the appointments against any other commitments that might come up.
- Be clear about your goals. Your mentor will be in a much better position to help you if you’re able to articulate what you want to achieve and then agree upon some SMART goals (remember that SMART goals are specific, measurable, attainable, relevant, and timely). It can also be helpful to ask your mentor about their own goals: these can give you an idea of what outcomes more experienced employees tend to prioritise and provide an insight into your own potential career path.
- Use your mentor relationship to tackle the big issues. When you’re just starting out, it can be tempting to approach mentors with questions about every aspect of your graduate experience, from working with new colleagues to dealing with unclear expectations. Over time, however, the most productive mentoring relationships tend to focus on larger questions about the overall shape of your career: where are you heading? What can you do to maximise your sense of professional satisfaction? Are you building the skills now that you might need to achieve your goals in five or ten years?
- Be prepared. Think of your mentor like a tennis coach: their job might be to help you perfect a one-handed return of serve by focusing on specific aspects of your technique. However, it’s still your responsibility to put their tips into practice, day after day, until your perfected approach becomes second nature. In a similar way, your mentor could provide advice on issues from improving your presentation skills to communicating effectively with clients. When this happens, make sure to act on their advice, pay attention to the outcomes, and arrive at your next mentoring session prepared to give feedback and thereby further optimise your approach.
- Be honest with your mentor. The more your mentor knows about your experiences as a graduate, the more focused and supportive their advice will become. This applies not only to career skills, but also to any other challenges you might face as a first-year. So don’t be reticent with your mentor if you’re feeling stressed, uncertain, burnt out, or blue: they can help you access appropriate support, move towards achieving a healthy work-life balance, and ensure that you get your career off to a productive and happy start.
9. Most graduate employers prioritise technical training for new recruits
When describing the content of graduate development programs, the AAGE report makes a distinction between technical and professional training. The former refers to ‘training of skills specific to the job that are built off theory learnt at university such as legal knowledge, accounting and tax regulations’. The latter refers to ‘training of abilities such as leading teams, report writing, communication, etc.’. A majority of employers provide fifteen days or less for both forms of training (71 per cent provide up to 15 days of technical training, and 75 per cent up to fifteen days of professional training). Only 21 per cent of employers require graduates to complete more than 25 days of technical training.
The exact nature of this technical training is not discussed within the AAGE report, so it can be helpful to check the GradAustralia website for insider reviews (click the ‘training’ tab) provided by graduates at your target company. For example, an Adelaide employee at CBA reports that their training involved learning about ‘how to analyse a set of financial statements, how to assess the viability of transactions, and, more generally, about legal concepts, how businesses operate and the economy’.
10. Most graduates choose to continue working for the companies that hire them (at least in the short term)
The AAGE survey doesn’t provide exact numbers when it comes to the likelihood that graduates will remain employed by graduate recruiters after a set period of time. However, it does require employers to estimate the percentage of graduates who remain working for their organisation from each intake (2013 to 2018). While these numbers reveal that retention rates decline over time, they also suggest that most graduates continue to build their careers with the companies that initially hire them.
For example, employers retain, on average, 94 per cent of the 2018 cohort; 80 per cent of the 2017 cohort; 72 per cent of the 2016 cohort; 58 per cent of the 2015 cohort; 50 per cent of the 2014 cohort; and 43 per cent of the 2013 cohort. In other words, at the five-year mark, the average employer will have seen 57 per cent of graduate recruits depart for opportunities elsewhere. By contrast, at the three-year mark, seven out of ten graduates remain employed in their first job3.
What’s the take away here? Well, the statistics indicate that you will be employed by your graduate employer for a considerable length of time. As such, it’s imperative that you establish a strong foundation for your career by using your first two years to build strong networks, take advantage of career development opportunities, and try out different specialisations. To gain an understanding of how current graduates are doing just that, check out the ‘On the Job’ reports on the GradAustralia website.
Putting your best foot forward
Together, the findings of the AAGE survey paint a mixed picture of the future for today’s graduates. On the one hand, entering the labour market is more competitive than it ever has been before, with each entry-level position attracting an average of 33 applications. On the other hand, graduate salaries are also higher than they have been since the inaugural AAGE report in 2003, and there’s abundant evidence that employers are committed to investing time and money in graduate development programs designed to help new recruits hit the ground running in their chosen career.
As a result, graduates face a two-part challenge: first, to secure a position with a reputable graduate employer and, second, to get as much as they can out of their first few years as full-time professionals. On both counts, GradAustralia is here to help with guides on everything from planning your career and submitting a standout application to making your mark in various industries. If you’re looking for a place to start, check out our recent article on the four ways you can distinguish yourself based on the results of the AAGE survey.
Ready for the next step? Browse graduate programs and internships here and sign up for the latest job vacancies and career advice from GradAustralia.
1. It’s important to bear in mind that several major industries were, arguably, under-represented in the AAGE survey. For example, the agricultural industry generates 12 per cent of Australia’s GDP and employs 2.6 per cent of the total workforce. However, no dedicated agricultural businesses were included among respondents to the AAGE survey. The same caveat applies to the data describing roles related to education and social work.
2. This number would likely be higher if the AAGE report focused on respondents that have cadetship programs. Generally, these include large accounting firms (e.g. EY, PwC, and Deloitte), some government departments (such as Transport for NSW), and significant employers in the engineering and construction industries.
3. As noted above, the AAGE report also found that only nine per cent off graduate employers offer graduate development programs that last for more than two years. Hence, one can infer that the majority of graduates still working for their first employer at the three-year mark are no longer contractually bound to do so.