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Struggling UK graduates can no longer afford to relocate for a new job, research has found.
Between a deposit and the first month’s rent on a new flat, transport, and a new work-appropriate wardrobe — all before the first pay cheque — it costs an average of £2,631 ($3,450) to relocate for a new job, Milkround’s survey of 2,000 recent graduates found.
For those moving to London, it’s even higher — £2,874, compared with £2,511 for those outside the capital.
For 85% of graduates, this is money they just don’t have, with 67% relying on their overdraft to survive, and the average graduate borrowing £1,375 — on top of about £35,950 of long-term student loans and living expenses debt.
One in 10 graduates can’t even afford to travel to job interviews, having to turn them down instead.
This isn’t due to a lack of responsibility, research suggests. According to two thirds (66%) of students, their maintenance loan simply don’t cover the cost of living, leaving them short by about £267 every single month, Save the Student found in 2019.
This means that while over three quarters (77%) of recent graduates believe they would have better career opportunities further afield, just 15% can actually afford to move to pursue their dream job.
All of those who said they would have more job opportunities if they moved to a big city agreed it is harder to relocate than it was just 10 years ago, and graduates are more likely to stay in their hometowns due to the rising cost of living.
“I moved back home with parents and am reluctant to move elsewhere, even though there are better opportunities, because of cost,” a biological sciences graduate from the West Midlands told Milkround.
Women are even less likely to relocate — just a quarter (27%) move for work, compared to two in five (41%) men, the research found.
Young workers are a third less likely to move for work than in the 1990s, with just 18,000 Brits between the ages of 25 and 34 relocating for work in 2018, compared to 30,000 in 1997, according to research from the Resolution Foundation in 2019.
This is because housing costs in job hotspots are so high relative to earnings that even with a higher salary, most Brits wouldn’t actually see a boost to their savings, it found.
Those who move to London, in particular, end up compromising on their quality of life, the survey discovered.
“When I first moved to London from Edinburgh in 2011, I prioritised pursuing a desirable career over living life to the full. While I knew living in the heart of media-land would ultimately boost my earnings, I had to make do with a small and (initially) very humdrum flat, with low outgoings and no luxuries, while friends who lived elsewhere in the UK enjoyed a much more civilised lifestyle,” Iona Bain, founder of Young Money Blog, told Milkround.
Salaries are lower outside London, but disposable income goes about 17% further — every £1 spent in London is equivalent to £1.17 in the north, Totaljobs’ Northern Pound research found.
Because of this, nearly half (45%) of graduates said they are considering taking a job outside London, or moving to a less central area. Commuting is cheaper than relocating closer to work, 61% of graduates said.
“While it’s true that there are more better paying jobs in the cities, the living costs are considerably higher, so any surplus earnings are essentially cancelled out,” one geography graduate in south-east England told Milkround.
“I decided not to move to a large city and wait for an appropriate role near to home. Eventually I lucked out.”
Of those who do move, 38% have to borrow the money from their family, 36% have to dip into their savings, 18% have to use their their credit card, and 16% have to take out a loan or use their overdraft, the survey found.
What’s more, less than a third (29%) move into permanent accommodation straight away, with the rest staying with friends, in hotels, or even camping in tents for up to several months.
Over four in five (85%) struggle financially in the first month, with 14% resorting to skipping meals and 11% needing to use food banks.
When asked what employers can do to help, nearly a quarter (24%) of graduates said an upfront payment for joining a firm would go a long way, while others would want help with their first month’s rent (22%) and deposit (21%).
Two thirds (66%) of graduates who can’t afford to relocate said they would be able to with this help.