Use of AI in graduate hiring soars as grade requirements relaxed

More than a quarter (28%) of employers are now using some form of artificial intelligence (AI) in their early careers recruitment, up from just 9% in 2022, as more employers continue to relax graduate grade requirements.

The Institute of Student Employers found the most frequent use of AI was in online psychometric assessments, but it was also commonly used to pre-screen candidates, to update them about the application process and to analyse video interviews.

The ISE’s Student Recruitment Survey 2023 showed that graduate job applications had increased 23% on last year with an average of 86 candidates per vacancy. The research, carried out in July and August, received 169 responses from student employers who hired nearly 43,000 graduates and school leavers in 2022-23.

Employers reported that AI was increasing speed and efficiency (83%), making it easier to analyse large volumes of data (64%) and enabling repetitive tasks to be automated (59%). A further 17% reported it was cheaper than using people and 8% said it enhanced the likelihood of finding the best candidate for the job.

However, 70% of employers said that they preferred a more human approach in the hiring process mentioning concerns about the reliability of using AI (63%).

Georgia Greer, head of insights at ISE said: “AI is creating opportunities for employers to do things differently in a more effective way. With the rise in job applications, the increased speed and efficiency is particularly attractive. It should improve the candidate experience too.

“It can be a juggling act for recruiters who want the efficiencies, but are questioning the ethics and whether they’re comfortable removing human interaction from the process. As AI evolves and improves, confidence will grow and some of those concerns should fall away.

“From a candidate perspective, they may be asked to use tools like ChatGPT to answer questions and playback their experience at interview. But at the moment, AI is mainly being used to assess performance in the process, so it’s not something candidates will always be aware of or can prepare for.”

Graduate grade requirements

Increasing numbers of employers are relaxing entry requirements for their graduate roles. Only 44% of employers require candidates to have a minimum 2:1 degree, compared to 76% a decade ago. A quarter (26%) require a minimum 2:2, but 18% set no minimum requirement. Only 9% of employers surveyed had requirements based on A-level grades or UCAS scores, down from 40% a decade ago.

Stephen Isherwood, ISE chief executive, said: “While businesses continue to invest in graduates as the workforce of the future, they continue to reduce reliance on minimum academic cut-offs for applicants. This is a positive trend for social mobility. By reducing focus on grades, fewer young people are being filtered out of the opportunity to access a good job on the basis of their performance at school.”

Most employers (82%) said they have no intention of moving away from a degree as a fundamental criterion for graduate roles in the foreseeable future. The retail, FMCG and tourism sector had the highest proportion of companies (44%) with no minimum academic requirements.

The ISE report said that organisations want to control their own quality requirements, rather than outsourcing this to schools and universities. It has also been advocated as an approach to improving social mobility, although the proportion of employers with no minimum educational requirements fell to 18% in 2022-23 (from 26% last year) raising questions as to whether this trend is reversing.

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