Traditionally, many of the UK’s leading employers have relied on using a small number of well-established entry points when recruiting young people into their organisations. The cumulative effect of this is that, over time, companies have come to find that their workforce is not as diverse as it could be.
One of the most common ways to recruit young people is through graduate schemes, requiring applicants to meet a rigorous set of requirements; for example, achieving a particular degree classification, studying certain subject, or exceling at a host of challenging psychometric tests. Only once these conditions have been satisfied are applicants invited to the interview stage. While there is no denying that some jobs require these metrics, we have come to find ourselves living in a world where attending university is a necessity when applying for a job. This is shutting companies off to a huge pool of talent from all walks of life.
A number of industries and companies, however, have started to broaden how they attract and recruit young people. Corporate apprenticeship and traineeship programmes are on the rise, allowing young people to gain practical, on-the-job training without being saddled with university fees and student debt. The number of apprenticeships schemes has increased dramatically in the last few years, driven not only by the introduction of the government’s apprenticeship levy but also by companies wanting to build a more diverse workforce. After all, young employees will one day become the future drivers of growth and direction of the company.
Apprenticeship schemes are more common in some industries from others, or at least that is the perception among young people. We commissioned a survey of 1,500 people aged 16-24 in the UK, which showed only nine percent believe that it is possible to secure a job in the financial services sector through an apprenticeship, with 73 percent believing a university degree is essential to being able to work in the industry.
The perceived educational obstacle is undoubtedly a major challenge for the financial services sector as it attempts to diversify both its workforce and the points of entry into a career in the industry. While our research shows that intellectual stimulation, a good salary and company benefits are key motivators for young people who are interested in taking their first steps into sector, financial services remains far down the list of popular industries, with 46 percent of those surveyed saying that they wouldn’t consider a career in the sector and just 16 percent finding the sector appealing. Added to the fact that a large majority of young people think that a career in financial services is off-limits to them if they haven’t gone to university, the sector is losing out on potential talent.
Also propelling the sector’s failure in attracting the best and brightest youngsters from across the population in the global war for talent are a number of misconceptions about what a career in the industry involves, with stereotypes about working hours and company cultures driving negative perceptions. Investment2020 research found that the words that young people most commonly associate with financial services are ‘complicated’ and ‘stressful’, while a third of those who had discounted a career in the industry expressed a concern that they wouldn’t fit in by saying that they thought the sector was ‘not for people like me’.
Attracting young, diverse talent into the workforce is crucial for any company to remain competitive, to foster innovation, and to grow for the future. Fortunately, investment companies are starting to see the light. They recognise that the traditional graduate programme is no longer enough and that out-dated recruitment practices have shut them off from a larger pool of capable, eager and creative young people who could thrive in the industry.
The savings and investments industry needs to show young people the range of opportunities that are available to them already, but also continue to create entry points into the workforce; whether it be through one year trainee programmes, apprenticeships or post graduate training schemes, to ensure young people feel they have the opportunity to get on to the career ladder regardless of their background. By starting to build a reputation of valuing differences, the industry is going in the right direction, but it needs to move quicker if it wants to attract more young people to the sector.
Companies are actively making changes to build a more diverse workforce from the C-suite level down, but they need to work harder in raising awareness of the steps they are taking. Investment2020, along with other trainee programmes, is actively working with companies to break down this perception, having helped place over 1,000 trainees in the investment management industry. However, this is just the tip of the ice burg and we calling more firms to join this wave of change.