In addition to last year’s unfilled vacancies and last minute job offer rejections, graduate employers are facing a new problem – holding on to their graduate hires after completion of their initial training period.
The Association of Graduate Recruiters (AGR) revealed that 16% of graduates leave within the first two years of employment, an increase of 9% compared to last year. Financial services was the only sector to record a small (1%) increase in graduate retention levels. Replacing a departing graduate hire is becoming more difficult too. According to data from Adzuna, the graduate sector is in the top five for skills shortage as 7.4% of graduate vacancies remain open after 90 days.
Engaging with your graduate recruits and understanding what motivates them enables HR to improve retention. Deloitte’s 2017 Millennial Survey highlights what millennials as a whole want from their employer:-
- An employer that acts as a force for positive change in society.
- The ability to make an impact within their role and opportunities to be involved with ‘good causes’ locally. Workplace apathy is a significant problem for the UK’s employers, making meaningful work a priority to improve retention levels of graduates.
- Transparency, ‘plain talk’ and an inclusive culture, with the focus on a leadership which appeals to people who are isolated.
- Flexible working opportunities.
At an average cost per hire of £1,700 according to the AGR, and a median spend of £3,105 per hire on graduate development, the implementation of a graduate retention strategy must be a priority for HR this year.
Incorporate the following steps to reduce your attrition levels:-
Review salaries, including the gender pay gap
Better pay was the reason given for almost 1 in 5 graduate departures in the AGR’s survey. Creating a culture of transparency and equal opportunities for all of your employees will improve attrition rates. Research carried out in 2016 found that overall, the starting salary of female graduate sis £1,400 lower than males in the majority of subjects. Agriculture and forestry has the widest pay gap at £2,500. Female graduates often earn more than their male counterparts in just eight sectors, including general engineering, social work and pharmacology and pharmacy. Review the data in your recruitment software to compare starting salaries of your graduate intake compared to your attrition rates.
Introduce an internship programme
Graduate hires who previous working as interns stay on average an additional six months with their employer. UK internships have doubled this year but have attracted a degree of criticism due to the number of unpaid positions and HR’s tendency to allocate opportunities to well-connected individuals, inhibiting social mobility. The Institute of Public Policy has proposed the introduction of a National Opportunity Programme as an alternative, to increase diversity among graduate employers. An effective, transparent internship policy promotes your employer brand and enables HR to create a graduate talent pool as well as improve retention levels. Review the data in your recruitment software to identify the effectiveness and diversity of your internship programme.
Managing the post-training transition
The period after completion of graduate training must be managed as closely as the onboarding process. Check in regularly with your graduate hires, ask for feedback on how they feel they are performing and whether the job is meeting their expectations. Accenture found that 70% of graduates feel they are under-employed in their current role. If high levels of attrition persist, the patterns in your HR analytics will pinpoint the most common point of departure among your graduate hires. That is where your weakness lies.
Offer career development and training opportunities
14% of graduates leave due to the lack of opportunities for career progression according to the AGR. Some employers place so much emphasis on the graduate recruitment programme in order to attract the top talent that fulfilling the promises they made during the hiring process are forgotten. Provide ongoing training and career development to meet expectations of meaningful work and retain your top talent.
Carry out an exit interview
An exit interview should be mandatory for all of your employees. The responses will enable to HR to more effectively manage graduate hires after training programmes are complete. Include questions on graduate training, culture, career development and leadership. Recurring patterns will be identified in your recruitment data over time.
Introduce innovation to minimise the risk of a bad hire
Leading employers are introducing innovation into graduate recruitment strategies in order to improve candidate selection and attract the top talent. In response to the competition for talent from the fintech sector, RBS introduced gamification and online simulation into their screening process. Hackathons are also common in the banking sector to ensure a successful candidate selection. Focus on the candidate experience, reducing your time to hire and effective onboarding through your HR technology to improve overall retention levels.
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