The 2009 crater, five years on

16 July 2014
Over the last month or so I have started to attend various technical meetup groups, many of which are startup-focused ones such as SiliconDrinkabout, and due to their location they tend to attract significant numbers of students & recent graduates. As a result a common topic of discussion is the economy and the jobmarket. A particular talking point recently was some statistics put out by the BBC, regarding 2012-13 finalists, and how they are planning ahead much more than previous classes. Stripping away the waffle, the stats distilled down to the following:

75% started researching jobs before their final year
43% had made applications before November
34% started researching before the end of their first year
15% started looking before they started university.

People looking at the graduate job-market a full 3-4 years before they have to enter it shows the level of pessimism with the current generation, and this level is not sustainable. I remember what it was like back in 2009 where the atmosphere was thick with the aura of recession, and while the aura has gone the problems remain.

Some history

The typical estimates of the graduate jobmarket, based on surveys such as High Flyers 2013, is that 2008 & 2009 saw a compounded fall of 25%. A problem with such surveys is they target large organisations such as The Times top 100 graduate recruiters, which of course only accounts for around 5% of graduate destinations. Lot of companies that did not recruit anyone simply fell off the radar: My lasting memory of 2009 was logging onto the University careers service website, and for ‘finalist’ jobs there was a grand total of 35. Graduate recruitment basically froze.

Of course what the statistics don't show is the extent that of the remaining graduate vacancies, relatively few were “open” vacancies, as by and large they were given to former interns and those who deferred an offer from the previous year. I was aware of some companies that had the explict policy of closing graduate recruitment completely: graduates were expected to join the internship schemes. No wonder that in 2009 applications to Bristol postgrad courses shot up by 30%, and 2010 admissions were closed long before Christmas.

Retention in UK

One thing notable about the UK during the crunch compared to the rest of Europe is that unemployment stayed relatively low. In the past recessions was when older workers got cleared out to make room for cheaper younger ones, but this time round organisations opted for retention. The only rational reasons for this is that recruiting people and getting them up to speed is now more than the salary differential. That means either recruitment costs have gone up, or pay scales have become flatter, and I suspect it may be both. I am aware that because of compliance such as anti-discrimination laws, employers put a premium on having people who are less likley to cause ‘problems’, and the only legal way of doing that is to recruit noone.

Experience insanities

While I can understand the aversion to taking on fresh graduates, it is not just graduates who have problems with the commercial experience requirements. These days the type of experience is becoming increasingly prescriptive:

Typecasting: Ten or so years ago all the talk was about transferable skills, with the declared point that even for software development jobs programming skills were not the major decision point in recruitment. I was skeptical of this at the time and it certainly isn't true today. Used C & Java/C# professionally but they want C++? Forget it. I got my current job by playing up the extent I had used Python in my previous one, and only got away with it because I knew just enough to survive 80% of the questions they asked about it over 15-20 minutes.
Breaking out: Because companies want ‘commercial’ experience but don't really define what it is, I use the catch-all definition of things done on company time. The problem is how to extend the scope of experience on company time in a reasonably legitimate way, which typically means choosing implementation technologies such as programming language based on CV gaps rather than prevailing choices and/or expedience. My last company was one that did a lot of experimental stuff, so doing this ulterior motive work such as was relatively easy, but this tends to be the exception rather than the rule.
Verification: Getting and claiming experience is one thing, but for it to be plausible it also has to be in line with what the company actually does, lest someone should actually mention it while getting references. I could plausably claim Ruby experience at my current company as I happened to use it to write an RPC agent one sprint and could play it up because MCollective is used extensively, but claiming C#.NET would be a non-starter as the company does not develop for Windows. I have heard stories such as “experience with Visual Studio” meaning seeing someone else use it.
Unrealism: I am forever amazed at how many job specification ask for unrealistic skills sets such as expertise in multiple disparate language and technologies, to the extent that if someone actually claimed to have it all, odds are they are lying. More prominently I have seen job adverts for C#.NET asking for 10 years experience, which means that notionally suitable candidates would have had to been using it continuously since version one. And one wonders why IT is not exactly known for honesty.

Recruiting from the crater

One of the bigger ironies of the focus on experience is that a lot of companies as a result are fishing in rarefied talent pools. When I stared my current job, typical experience requirements of job specifications around the time was 2-5 years of commercial experience. For someone to have that on the clock late-2013 means they would have entered the jobmarket 2008-2011, which is when the numbers doing so went through the floor. As a result a lot of companies end up hiring people in the 8-15 year experience bracket, which is basically why €80,000+ IT salaries are all over the place.

Vanishing SMEs

The graduate IT job-market is one that got hit quite hard because a disproportionate number of people cut their teeth in SME companies, either as interns or as graduates, and SMEs took the brunt of credit drying up. I knew my former company had a few tight spots, but looking back at its accounts via Companies House, and I was shocked about how tight things actually got around the time i was there. I suspect that there was several occasions where cash-flow came within a few weeks of sinking the company. Banks de-risking lending basically meant no bridging loans, which has made start-ups all the more risky. In theory new graduates would be the perfect type of people to try their luck with start-ups, but in large part due to student debt, they are too risk-averse.

Locked out

The advice to graduates at the time was take on low-skilled jobs, and as a result five years on half of graduates are now in non-graduate jobs. The problem is that none of this puts skilled experience onto the CV, and with it what they covered at University starts to fade in comparison to more recent graduates. To make matters worse a lot of these will no longer have access to university careers services where a lot of graduate employers go fishing, so it is quite feasible that a lot of 2008-2011 graduates will end up getting leapfrogged my more recent graduates. These are not exactly organisations who would use the JobCentre to advertise vacancies.

Agencies

No matter how attractive, these days I simply do not take agencies seriously. I have met 1 or 2 who actually put a proper effort into getting me a job, but by and large they are liabilities, with agency fees alone sinking at least one of my past applications. In fact the way agencies flood everything in sight has contributed to another irony of the IT job-market: Recruitment by and large is no longer done online. LinkedIn is a bit better, but within the last few weeks I have spotted and reported a few people who contacted me who on closer inspection were obvious frauds. No-one with reportedly 5 years running at their current outfit would do silly mistakes such as emailing blatantly wrong job specifications, and put more effort into getting my email & phone number than an overview of my skill-set.

The scars

According to researchers at UCLA, the typical person who graduates into a recession will take 10 to 15 years to recover, and as a result many who went through it are scarred by the experience. Talking to various people both sides of the divide, it is clear that those who got their careers going prior to 2008 have no concept of what it was like at the sharp end in 2008-2011. Although I started in 2010 my last job I applied for right at the bottom of the crunch in 2009, although the only thing that seems to have really changed is that younger ones seem to be a lot calmer about it all.