There is a “significant disconnect” between recent graduates and their employers over salary expectations, promotion prospects and management relations, new research has shown.

One-third of graduates are unhappy with their line manager’s performance, while more than half plan to leave their organisation within two years, according to a report from the Institute of Leadership & Management and Ashridge Business School.

The study described Generation Y university leavers as “fiercely ambitious and strongly motivated by money, status and career advancement”, while their managers “have a more conservative view of graduates’ pace of progress.”

The survey of 1,200 graduates and nearly 700 managers found that a significant proportion (45 per cent) of new recruits with degrees believed that their salary was below or greatly below expectations.

And while 13 per cent of graduates expected to land a management role within their first year, only 6 per cent of managers thought this was a realistic target.

The report – Great expectations: managing Generation Y – found that graduates’ top three priorities in the workplace were challenging and interesting work (33 per cent), earning a high salary (32 per cent) and advancing their career (24 per cent). They considered work-life balance to be the fifth most important factor.

However, managers were found to have misconceptions about what university leavers prioritised – rating salary fifth and work-life balance tenth. They also overestimated the importance of good management and leadership – rating it third, while graduates placed it twelfth.

And although graduates were broadly engaged at work – 75 per cent said they were proud to work for their employer – 40 per cent expected to leave their organisation within a year and 57 per cent within two years.

Some 16 per cent intended to find a new role as soon as possible, despite recent research from the Association of Graduate Recruiters showing that 83 graduates are chasing every available vacancy.

The Generation Y study also revealed that graduates had a distinct vision of the type of relationship they expected with their boss.

Graduates’ cited their ideal manager as a coach and mentor (56 per cent) or a friend (21 per cent), rather than someone who directs (8 per cent) or examines and audits (2 per cent).

While three-quarters of bosses believed they were fulfilling the role of a coach or mentor, just a quarter of graduates agreed this was the case.

“The survey highlights a significant disconnect between graduates and managers across many issues,” said the report. “This rift in understanding is bound to affect graduate job satisfaction, long-term talent planning and management, and individual and organisational performance, and needs to be addressed.”