The Career Ladder Is Broken - And Companies Are Paying The Price #104

After all, all art is experience. Hello, Gary.

Hey, George, how are you?

I'm fantastic, thanks. How are you?

If I was any better, I'd be triplets. That's what I would say right now. I'm so good, I'm three.

As always, top of the game in terms of your enthusiasm. We've got a topical topic. To be discussing today, and we're doing it slightly differently. It's sort of walk and talk style.

Sitting down.

We are talking. It's just a talk.

We are talking.

Yeah.

I love this every time we come up with a new initiative, this new walk and talk, but sitting down.

Yeah, it's good. It is good. I'll tell you what we haven't done for a while, which was brought to my attention recently, is a Eureka moment.

Yes. Maybe next time.

I think we need to bring that back because they're very popular, those ones. Maybe because they're only sort of 5 minutes long, but surely not. That's nothing to do with it. But we're talking about the disappearance or the rapid sort of decline of entry-level and junior job roles. And I've come up with a title, Climbing a Broken Ladder at the Cost of Lost Entry-Level Roles.

It's catchy though. It's quite catchy. It's a massive issue right now. And I think it's going to have massive ramifications if someone doesn't think differently. So I think well done for. For choosing this topic. I'm looking forward to talking to you about it.

Yeah, well, I'm going to fire a few stats at you first, and then I think we can dive into some questions just about the sort of some of the reading I've been doing. I know you have as well in preparation for this, but here are three sort of, I think, quite stark figures. UK tech graduate roles fell by 46% in 2024, with industry projections forecasting a further 53% drop by the end of 2026, which is quite scary, very scary. 66% of global enterprises admit they are actively reducing entry-level hiring specifically because of AI adoption and automation. And then finally, over 51% of jobs currently advertised as entry-level now explicitly require prior work experience, with the average request being 2.7 years, which is the age-old thing of, you know, you need experience. I remember, and I think I've mentioned it before, going to a pub, my first ever pub that I wanted to work at and saying, can I work here? And they said, well, you need experience. Me saying, well, you could give me.

Exactly. You say, I've been a drinker. Yeah.

Got plenty of experience on this side of the bar. And it's that sort of latter fact and stat that I'm going to start with.

Um, the cheerful statistic, George.

Thank you. I'm trying to keep it cheerful, but it's tricky. Um, but yeah, so around that sort of the fact that people are looking for experience, 51% of jobs advertising entry-level are now requesting 2.7 years of experience. Why do you think employers are asking for that when, you know, it used to not be the case? You know, these used to be for beginners who have no experience specifically, and now they're requiring 2+ years of experience. What has caused that shift?

Yeah, well, I think, you know, when you get, lift the covers a bit, it becomes obvious that there's a kind of a perfect storm of things going on right now. One is the economy. Actually, before the economy, it was the pandemic. It's kind of, people haven't really recovered from it and what it Well, the impact has been on both sides of the conundrum for people working. The second one is the economy. Things like wars, things are getting unsettling of the world and people becoming tribal. And the third one is AI. And I think the combination of all those things has led people to panic because when there's not business confidence, then people won't spend money. And by the way, the government haven't helped by putting up national insurance. So it's like, I'm an employer, so it's £650 a person extra. Before you do anything else without giving them a pay rise. And therefore it makes sense when you think of it that way for an employer to go, well, I better get someone who's got a bit more experience because I'll get more out of them. Even though that may not be the case. That was my long-winded answer to that question.

No, that's perfectly winded. I'd say there are some problems with that, aren't there? Because by hiring only seniors who, you know, haven't necessarily been nurtured from the ground up at the company that's hiring. There's a bit of a danger that employees accidentally are killing off long-term company loyalty, wouldn't you say?

Yeah. And by the way, just by the stats, we don't want people to get the impression that there's lots of roles available, even for that 2.7-year tenure. Because actually your stats show that it's a massive downturn. I thought it was more like 33% this year. Maybe last year it was more. And actually, just to give people a visual, it used to be pyramid-shaped where you have some senior team at the top and then the worker bees and then the graduate or younger intake fueling growth for the business going forward. Now it's more diamond shaped, if you think about it. So people at the top, loads of people in the middle, maybe been around a long time and very few people, new thinking, new people coming in. And that, there's absolutely going to be a problem in the next 2 or 3 years for people.

And is, have you seen that sort of across the board?

Yeah, I think that diamond shape, it's kind of in your stats really. I've just given you a visual of it because if there's less coming in, then you are stuck with the old ways of thinking, which is fine. But the other stat that I've looked into is the demographics are much older. So there's a lot of people retiring, a lot of experience disappearing, and that means that there's no one to share or mentor the experience. Not no one, there's less people. And there's no one to share it with because then you've got the people that have been around a long time anyway. And so the natural conclusion for people is, is AI, the answer's AI. And I'm sure you've got a question about that, which I'll save.

Yeah, I have. I've got a couple. The next one being, what in your view, and I know that you're an advocate for, you do a lot of work with students and recent graduates and things. What is the hidden value or maybe not so hidden value of 21-year-old that senior executives simply can't see?

Yeah, look, I think it's like everything. You, you can always learn, uh, to do things. And anyone who's got kids will know that they can learn from their kids because they don't have the baggage of the past. The world's changed and they're more adaptable. So, you know, smart people with new ideas and new ways of thinking, you just can't replace that because otherwise you're just stuck in the old ways of working, which may be fine up to a point. But a good example for me was in my research, if you look at legal firms or accountancy firms, now AI has become a big engine for the, in their mind to replace the first career people, but actually it's kind of missing the point because at some point there's no one to train the next level because that's normally your career path. So, you know, I think that's basically an issue. So if you're a company. Then you're missing out because you're not learning new ideas. You've not got fresh energy and you've not got the growth engine for the future. And the truth is, if you don't hire, a company will cease to exist in the next 15 years. Yeah. If you think of it, if it carries on like that, because otherwise who needs you, right?

Yeah.

Yeah.

And it's quite scary because maybe, I mean, I don't know this to be true at all, but based on what you're saying, I mean, it feels like that's only going to go up and up and up as in like, you know, first it'll be the entry-level jobs and then it'll be the sort of mid-roles and, you know, is that going to Is that just gonna panic?

Yeah. Again, a lot of people panicking about AI and stuff like that. I'm not panicking about it. I think there will always be work. It just changes the way we work. Now, I was fortunate enough to speak at Nottingham University yesterday at the Future of Work Conference, which second-year students go to every year. And part of the reason they're going is to find out how they can adapt to getting jobs because it's harder. You think how hard it is for them to actually get them. Even someone on the sandwich course was struggling to get a work experience for free. But the key thing is that, you know, the richness of different, you know, people talk about diversity. Diversity is also about age and experience and background and a whole bunch of things. And so the natural reaction to a difficult economy is to focus on the money. But I think if you're a progressive company, you should focus on the money, but not solely on the money.

Okay. But I'm actually going to ask about money now. Um, you can show me the money. As you know, I'm very money. Seriously money-oriented person, as you know, is hiring a senior person actually riskier, not a senior person, a senior individual from a work perspective, actually riskier and potentially more expensive than training a junior from scratch. So is it actually bigger? Is it more of a business risk to stop growing homegrown talent?

Well, the answer is not black and white, right? Because at one level, yes, because your people might be stuck in their ways or they'll be expensive and the value for money might not be there. Especially with things like AI, because some of the things people don't want to adapt to the new world they're in. Um, being able to mold someone is always good, but then on the other hand, younger people are more flighty. Uh, some cases, don't want to generalize, uh, you know, they have thoughts about how it should be for them. And, you know, there was an article in The Telegraph last week, actually, and there was a very similar article in The Times at Christmas that basically did look back 5 years to see Yeah, from a graduate point of view, what's the difference between being an apprentice and a graduate financially over a 5-year period? And the article was there to make a point that you'll probably make more money as an apprentice than a graduate. But from a company point of view, I think there's more benefit to a company sooner having an apprentice because they can mold in the way you've just described. They can mold them in their way and they've got kind of a structured path to moving in that direction.

Yeah, nice. And I know that you wanted to sort of flip this slightly and not just talk about employers and the sort of benefit and risks for them. If we aren't doing as much mentoring as we did, and I was reading a bit about, you know, the sort of the lack of mentoring, and I suppose as these sort of jobs drop off, that sort of is going to naturally happen anyway. Why should a young person, and you know, specific, you know, some of the young people that you were talking to recently, why should they care about a company's goals and sort of values? What's the incentive, I guess, for young people to join?

Well, I think this makes it really interesting, right? Because it polarizes what's available because there's less things available and there's some people that are more progressive than others, so which will attract people that are available. So my thoughts are that if you're too focused on the money and not on developing people and mentoring and bringing people up through the ranks, You're going to absolutely miss out. And I think graduates and even people in line for apprenticeships will want to focus on companies that obviously want to develop them. I don't think it's changed. It's always been the case. So I think it will polarize which companies now get reputations about where people want to work. Your question's in reverse. I think the main thing is if I'm a company owner, which I am, and we get massive benefit from our young people, it's difficult because it takes time and we're not mature enough to always develop them in a more structured way, but we take it seriously and we care about it.

So you nurture these people and you sort of create an environment where people should care about your company values and your goals and ambitions.

Yeah, a good example is there's other ways you can help them. We've just joined the Management Consulting Association and they have a strong track on young consultants and, you know, that's a great place. So, you know, we can get leverage from like the MCA to help our young people develop, but with more grown-up thinking. So it's not always like, as a company, you have to find a way to do what you need to do.

Yeah, nice. I'm going to just step in here slightly and remind you that you occasionally, when you get passionate about something, bang your fist on the table. Yeah. And I think we can keep it in because the viewers need to know just how passionate you get.

Just means that when you hear banging the table, I'm being passionate.

Exactly. Yeah. And you know, this one sort of might Garner the same results from you. You mentioned AI, and obviously I was going to talk about AI eventually. We often say that AI augments workers, but for a graduate, you know, it's currently acting as a bit of a barrier to entry. How can a manager redesign a junior role so that AI acts more as a power-up than a replacement for their first year of learning?

Well, that's a great question. I think they've got to wanna. Well, people are struggling. If you're in a business, people are struggling with AI. I think what companies should do is focus on how they can make their employees more efficient by using AI rather than trying to replace them. There's some obvious jobs that you can replace people with AI and give people better jobs. That's fine. And it will change that. You know, I mentioned accountants and lawyers. I mean, that's a good example at the entry level. But here's my challenge to you. If you're in a company, if you replace your activity fully with AI, then your customers are going to replace you with AI. What is your relevance if you're just AI? Then someone else, if you can do it, then they can do it. Does that make sense? And the nuance of the reason why you need both is yes, you need to be more efficient and spend time on other things. But the difference is the experience that you provide someone and the focus on their outcomes using a combination of things, AI and people, but people make the difference. People want to build relationships with people and get response and sometimes speak to a person and Octopus Energy. I know we give adverts to them, but it's a great example. If I want to query something, I can speak to someone and I love that.

Yeah. And I'm actually working with them currently. So that's going to work really well in my favor, potentially from a professional perspective. So thanks, Gary, for the plug. I'm just going to quickly talk about the sort of CEO explanation to the board and what that looks like. You know, we've got these reports that warn that cutting entry-level roles will lead to a leadership drought by 2030. You mentioned that earlier. How should a CEO explain to their board that saving, say, 40K on a junior role today might cost the company its next VP in 5 years?

That's a good question. And I think that's the thing. Life's all about balance. It's not always about the money. And it's understanding the implications of decisions that people make. And so a good example for me would be that, you know, if I was a CEO, I would want to balance out having, you know, good strong leaders, but with strong efficiency in my business, um, as a kind of a bit of a triangle, a good customer experience, solid leadership, and as much efficiency as possible to take away the boring tasks that where mistakes are made, to be honest, and it ruins your customer experience. So I think it's a combination of those things and then you can build the return on investment case for that based on a combination. So then you're, you've got the cycle with the motor kicking you up the arse, moving you forward rather than you're on a motorbike and it's driving you.

Yeah. Nice. We haven't had many of these for a while, actually.

I'm glad they're sort of— No, that's a good move, a t-shirt.

They're starting to reemerge.

I might have a phrase against it.

It was nearly there. It may be a hat. Almost. I'm trying. Yeah. Um, just to sort of flip it back to the people who are in a position to be looking for these sorts of roles, and I know this is something that you are passionate about, how can they, I guess, get that experience without necessarily having that experience? So if you are coming to the end of your degree or whatever, how can you put yourself in a position to have had the experience that you almost don't have, if you know what I mean?

I love this question, and this was the prime focus of my talk on, at the Nottingham University for year twos and university. The best way you can do this is you've got to build your own experience. And what I mean by that is when I was 15, I had a charity of 40 young people and we ran events. Um, and, and that was, that gave me so much experience about loads of things. But when I went to my first interview, I could talk about how I've organized something. And I'm not saying you should do something like that. If you want to be an accountant, go and work in an accounting firm and do it for free. If you want to be a hairdresser, go and work in a hairdresser. Yeah. Year 2 is the best time because you've got time to go and get experience and have something about you. You've got to differentiate because of what you've just said.. And if you don't, you'll be like everyone else. Now, if there's 33% or 40% less jobs, there's more people going to uni because they think that's the answer and there's less jobs. So it's more people going to uni chasing fewer jobs. You've got to differentiate so you can get experience by volunteering, doing something different and giving yourself time to do it. And then you've got something to talk about. That would be my number one bit of advice, which I gave the students. The other day. And by the way, the win rate is so low on jobs because there's so few, just responding to applications just won't get you there. You've got to do other things, which is a topic for another day.

Yeah, no, that's solid advice, I think. And just, you know, on that talk that you gave the other day, I don't know if you were able to gauge this, but what was the sort of general feeling amongst the students there? Did you get a feel for how they're feeling about the sort of current landscape?

Yeah, I mean, a lot of students came to speak to me afterwards and, you know, some of them have started already to try and find even free work, right? They're struggling and they're finding it really difficult and they don't know if it's them. And sometimes it is, right? But it was hard already. You know, we spoke to the uni last year and it was hard, but it's even harder now. You know, AI isn't helping obviously because it is scraping jobs. But what came across is there needs to be a sense of urgency. You as a student need to take ownership of it now. Now is the right time actually, if you're in year 2, for example, because you've got time to network a bit more, get some experience, ask some friends to introduce you to people. Take control rather than waiting for the inevitable, which is I come out of uni, I can't get a job. And by the way, you won't be able to because it's really hard unless you take control. So it's not easy. And it's the same for employers, by the way. You know, um, we're building a certification called the Career Ready Academy with APMG International, and it's to help people early in their careers. It's going to help companies have someone to plug the gap, as you said, when they started and you want 2 and a half years experience. So if we can give them some now so that they're not going green. So it helps the students and people early in their careers. It helps companies. It helps universities give people a path. And I think, you know, that we're taking that initiative because we think maybe that's a small way we can help. So that's something I'm working on.

Fantastic. And final question from me as we come up to the 20-minute mark. If a manager is feeling the pressure to cut costs, but they are sympathetic to all the many benefits that we've discussed of having younger people employed, fresh perspectives and new angles that they bring. What is the company doctor's prescription for keeping this career ladder intact without blowing the budget?

I would say mix it up. It's not binary, right? So you don't have to do one or the other, do both. So if you can't get a whole bunch of people, give someone a chance. Why don't you just give one person a chance? And whether they're really green, I get it's really hard to sell one that's really green. So find someone who's been working in at least one job. I think the criteria, I know it doesn't help the students particularly, but I think the criteria for taking someone on which is less risk is find someone's had one job. So they're less green or they've been through my Career Ready Academy one day, but that start with someone, mix it up a bit. So then you're doing both. But if you don't, if you don't feed the bottom, your business is going to run out of runway in the next 3 years. So you've got to do it and it's the right thing to do and you can build a business case to do it. It will make sense. And if you're in a, consulting kind of business, you might better build them out anyway and get the money back. So, you know, be creative. Good stuff.

Oh yeah. Well, thank you, Gary. That's fantastic. And I know that you were quite amped up for this topic. So if I haven't asked you about something that you wanted to talk about, now's the time to dive in. But if I have, then I'm a genius.

No, I just think it's the yin and yang because we wanted today to talk about where a company needs to do the benefits. And, you know, because the economy is so difficult and AI and people are struggling with it. The natural reaction is to close down and hire less. And actually it should be the opposite. It's a bit like if you're in a traffic jam and you're trying to get somewhere, what do you do when you get through the traffic jam? You speed up. Mm-hmm. Yeah. And so in, when times are hard, what companies need to do is do the opposite, observe the masses and do the opposite, speed up, mix it up a bit, and actually you create energy. And different experiences. And I think that will take you further. You can get them to be on AI projects because they'll probably be better at it anyway. Yeah, that's my thoughts for what it's worth. Our walk and talk sitting down has been amazing, George.

The first lazy walk and talk. We're going to monitor this ongoing story because I think it is a really interesting one. I don't think it's one that's going to be solved overnight. And I think it's maybe even worthy of a live panel discussion with some interesting people. So let's explore that.

Yes, let's do it.

Absolutely. Thanks very much for listening as always. I hope you found it useful. We will see you very soon.

See you again soon.

Bye.