18 October 2017 Register to receive our free newsletter by email each week
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Is graduate over-qualification a problem?

A report last week from the Chartered Institute of Personnel and Development, or CIPD, bemoans the problem of graduate over-qualification, stating that the UK has too many over-qualified graduates entering non-graduate jobs, not realising investment in higher education and creating an unnecessary debt burden for too many young people entering the labour market.

Universities UK responded saying the skills higher education provides, such as the ability to think critically and to analyse and present evidence, are lifelong and increasingly in demand.

The report by CIPD, the professional body for HR and people development, entitled Over-Qualification and Skills Mismatch in the Graduate Labour Market finds that the increasing number of graduates in the labour market has significantly outstripped the creation of high-skilled jobs and is leading to negative consequences.

These consequences include employers using degrees as a requirement when recruiting for traditionally non-graduate roles, despite no resultant change to the skills requirement for these jobs.

CIPD says this has led to a situation where many graduates are simply replacing non-graduates in less demanding jobs, or entering jobs where the demand for graduate skills is non-existent or falling. This trend has particularly affected occupations where apprenticeships have been historically important, such as construction and manufacturing.

Universities UK responds

Nicola Dandridge, chief executive of Universities UK, the representative organisation for the UK’s universities, said in response to the report: “UK graduates are still in a substantially better position to obtain a job and, on average, earn substantially more than non-graduates over a working lifetime.

“Recent government [Graduate Labour Market] statistics showed that more graduates are in work this year than at any time since 2007. Graduates also earn almost £10,000 [US$15,600] a year more than people without degrees.”

Dandridge added: “Skilled graduates are increasingly in demand from employers. The Association of Graduate Recruiters, or AGR, predicted an 11.9% rise in vacancies this year, following an increase of 4.3% last year.

“The kinds of skills that higher education provides, the ability to think critically and to analyse and present evidence, are lifelong and are going to be increasingly in demand as the number of high-skilled jobs increase."

She said that many graduates do not go straight into their chosen careers after graduating. Some will get short-term jobs to fund further study or to go travelling. "Employment figures looking at what graduates are doing three and a half years after graduation show that the vast majority are in full-time employment,” she said.

Graduate over-qualification at ‘saturation point’ – CIPD

In a press release coinciding with the release of the report, CIDP calls for an education funding review and a national debate about how to create more high-skilled jobs as graduate over-qualification reaches saturation point.

The CIPD report also makes international comparisons, suggesting that graduate over-qualification is a particular problem for the UK, stating:

  • The UK has the second highest graduation rate in the OECD (54%) with only Iceland having a greater proportion. Germany, for example, has a graduation rate of just 31%.
  • The growth of graduates significantly outstripping the growth of high-skilled jobs generated by the labour market is prevalent among most OECD countries, but is particularly pronounced in the UK.
  • The UK has 58.8% of graduates in non-graduate jobs, a percentage exceeded only by Greece and Estonia. In contrast, countries such as Germany, the Netherlands and Slovenia, which have a history of strong vocational training, have 10% or less of graduates in non-graduate jobs.
  • The UK also has one of the highest levels of self-reported over-qualification among graduates in Europe.

Peter Cheese, chief executive of CIPD, says: “The assumption that we will transition to a more productive, higher value, higher skilled economy just by increasing the conveyor belt of graduates is proven to be flawed.

“Simply increasing the qualification level of individuals going into a job does not typically result in the skill required to do the job being enhanced – in many cases that skills premium, if it exists at all, is simply wasted."

Cheese described the situation as “unsustainable” given that “the government estimates that 45% of university graduates will not earn enough to repay their student loans”.

“It’s crucial we as a nation take stock now of whether our higher education system is delivering desired returns for graduates, for organisations, and society,” he said.

“Just as importantly, we need to start a national debate about how to generate more high-skilled jobs which means organisations investing more in developing their leadership and management capability, building more progression routes and improving work organisation and job design so that people’s ideas and skills are used more effectively in the workplace.”

Cheese said that the report highlighted that young people should think carefully about opting for university when going into an apprenticeship might be a better choice, and that efforts to provide good quality career information and guidance should be stepped up so they can make better informed decisions.

This paper shows again that the rush to 'university' degrees was a monumental blunder. The reference to thinking skills and the like is valid but does not need a university. The old system of apprenticeships with obligatory part-time attendance at what used to be polytechnics was much more effective in preparing youth for jobs and much cheaper. Time to recognise the error and start reversing the change. Since most universities are funded by the taxpayer it shouldn't be difficult to do (and I speak as a university graduate in medicine, which would not be included here).

John Birkbeck on the University World News Facebook page
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