Graduate programs have tremendous potential to prepare students for careers that fit them and for employers to attract and validate the talent they need. But the current reality isn’t always aligned with this potential, often leaving students out of touch with potential pathways and impactful work and employers frustrated by their efforts and investments that result in minimal ROI.
Let’s take a look at the current lay of the land and what needs to change.
What’s the current sentiment?
In 2020, more than 130,000 university students graduated into the worst jobs market since the 1990s recession. When Deloitte’s Chief Economist Chris Richardson said that new graduates and school leavers looking to start their working life were facing a “really tricky time”, it’s an understatement.
Covid-19 altered the priorities of job seekers and their outlook on job security. The stability of roles in the public sector and a high threshold for job losses is attracting more attention than lucrative salaries in the private sector. Recent graduates with new skills are already thinking about when they’ll need to reskill and into what. These are ongoing concerns and discussions amongst Hatch’s talent pool of students and graduates, with Monica Li, a Hatch student at WooliesX, telling ABC’s 7.30, “It definitely makes me feel insecure, especially as graduates are probably the most dispensable employees.”
What are students saying?
We surveyed 300 students from our talent pool, and 90% of them intend to apply for a traditional graduate program. They’re anxious about entering the workforce and see graduate programs as a route to de-risking the transition. These programs typically run for between 1-3 years, often allowing grads to perform various roles on a rotating basis within an organisation. On paper, the opportunity to build their network, find mentors and discover different business units tick many boxes for students making their first foray into the workforce.
Graduate programs = stability so, problem solved?
Graduate programs have maintained a similar structure for several decades. The world of work hasn’t. Graduates are looking for more discovery and growth. They’re only choosing grad programs because there isn’t a better alternative and they often don’t stick around.
How this plays out in businesses running grad programs looks like:
- Declining retention rates of the graduate cohorts because of a lack of genuine fit between student expectations and business needs.
- Adhering to a rigid program structure makes it hard for businesses to respond to their fast-changing needs.
- Many students opt out because of the high commitment bar, making it challenging to attract diverse skills and backgrounds.
- Employers cannot meet students’ expectations once they commit to a program as they change frequently and often can be unrealistic.
So, you have two parties sinking a significant chunk of time (and resources) into these programs that ultimately aren’t delivering the outcomes either are looking for.
What needs to change?
Traditional graduate programs are too generic and don’t reflect the changing nature of work. What would a contemporary program need to look like that embraces the principles of flexibility and diversity so both graduates and employers can find a genuine fit?
We have a few thoughts.
Students should have the ability to rotate across industries and organisations to find their fit. Or in the words of a student from our talent pool: “These programs require you to commit to only one company, and that’s the single biggest risk. Who knows what that company will be like?”. There needs to be a balance of flexibility to navigate their own path and learn what’s right for them, with the stability of knowing they have guaranteed employment during the program. And they should be able to double-down on building their network across companies and have a great community experience.
When we asked our student pool what they care most about in their first full-time job out of uni, what do you think was overwhelmingly the number one thing? It’s not salary, it’s growth, learning and development. Regardless of where you look, the sentiment is consistent:
- 94% of employees say that they would stay at a company longer if it simply invested in helping them learn (LinkedIn’s 2019 Workforce Learning Report).
- One in four workers left their jobs in 2018, and nearly one-third of that turnover was attributed to unsupportive management and a lack of development opportunities (Work Institute Report 2018 Retention Report: Truth & Trends in Turnover).
Employers should be able to validate graduates’ fit before they’re offered a full-time position. New graduates don’t know what it means to work in an organisation before they try - they’re new to the workforce. Try before you buy is critical for both sides to ensure genuine fit, performance, and retention.
It’s also crucial that a contemporary graduate program enables employers to attract talent with critical “future of work” traits (like adaptability, drive, problem-solving and creativity) and “emerging skills” (like tech data, digital and design) that will accelerate their businesses ability to respond to fast-changing skill and resourcing needs. And we couldn’t make an argument without talking about ROI: a contemporary graduate program should be at least 5X higher than traditional programs by embracing digital channels and technology-based matching rather than just a heavy on-campus presence.
Change is coming
If you’ve found yourself nodding along as you read through, chances are you’ve experienced these problems first -hand at some point and know there’s a ripe opportunity for change. We’re making this change happen and are looking for employers who share our vision to help shape what graduate programs should look like in 2021 and beyond. If that’s you, shoot a note to Hatch’s Co-founder, Adam.