Politicians, not ChatGPT, caused the recruitment slump

The machines are already smarter and better organised than humans. They never ask for a pay rise, and they don’t ask any awkward questions about the company’s environmental record. An artificial employee is, in many ways, the model employee. But is artificial intelligence really responsible for a recent fall in entry-level jobs, as new figures from Adzuna, the online jobs board, would have you believe? Or is the Chancellor Rachel Reeves as much to blame as the ChatGPT founder Sam Altman?

It is certainly looking like a tough year to graduate from university. According to figures from Adzuna, the number of entry-level and new graduate vacancies on offer has fallen by 32 per cent from three years ago. Likewise, the jobs board Indeed reported that the Big Four accountancy firms – often the back-up choice for graduates who are not sure what to do with their lives but would like to make lots of money – have posted 44 per cent fewer job openings than they did a year ago. Add it all up, and one point is clear. The market is bleak.

It is easy to blame AI for that, and it makes for a quick headline. In fairness, there may be some roles that are now being automated. The trouble is, it is easy to mix up correlation with causation. In fact, there is a far simpler explanation for the collapse in graduate recruitments. Many companies massively over-expanded during the pandemic, and they are now cutting back where they can. Reeves put up employer’s National Insurance, a tax on jobs, in her last Budget, and may well put it up again this autumn. Likewise, the Deputy Prime Minister Angela Rayner is pressing ahead with an extension of workers rights. On top of all that, the economy is barely growing, and could easily be in recession very soon.

That slightly clueless twenty-something you might have welcomed into your organisation a couple of years ago will now cost you more, will be impossible to get rid of, and won’t have anything to do anyway because you don’t have many clients left. It is hardly surprising no one wants to hire them. It may be fashionable to blame AI for the collapse of graduate recruitment this summer. But the government is at fault. Pointing the finger at ChatGPT is just a distraction.