The following blog was published on 20th April 2020.
Graduate retention data has become a badge of honour in the economic development story. High numbers equals attractiveness to talent.
In 2019, The Great British Brain Drain analysed migration to and from Manchester, for instance, and found that 51% of students studying at Manchester universities chose to stay in the city after graduating. Only London had a higher retention rate.
These numbers were duly celebrated but the same study found that only 16% of these graduates staying on where they did a degree course are actually employed in knowledge-intensive private sector professions like law, software development, life sciences or engineering.
So where are our knowledge-graduates going in the workplace? The answer appears to be, wherever will take them.
A study completed in 2017 found that the number of students who had graduated in 1992 and were overeducated for their current employment stood at 22%. For the class of 2007, this number had risen to 34%. Should the same level of growth be maintained, in fifteen years’ time, today’s students could face a 44% chance of being overqualified for their careers.
All of the evidence therefore demonstrates that the majority of degrees are becoming simultaneously undervalued and oversold; a perfect storm for graduates to find themselves thrown overboard into the jobs market and treading water in a role they are unsuited for, whilst almost certainly burdened with student debt.
There are consequences elsewhere in the job market. If our gourmet coffee houses, bookshops and retail outlets are inundated with degree-educated staff, there will be a knock-on effect to the number of successful job applicants without a degree. The net effect is making it harder than ever for local workers to find employment.
In 2018, the average salary for graduates was £10,000 more than non-graduates. Economic ability remains one of the most important determinants for attending university, meaning that for as long as this cycle continues, those from poor and lower-educated backgrounds will be trapped in a hierarchical system without the skills or training support to move upwards.
In order to achieve inclusive growth, we must therefore approach the situation from an alternate route. For years, the topic of the skills gap has been discussed ad nauseam, but whilst university degrees have been heralded as the answer, our research has uncovered severe gaps in their offerings.
Take coding, for example. IDM studied the difference between so-called ‘coding’ degrees and found huge variance in the sectors these skillsets are relevant. Gaming degrees utilise coding largely for aesthetic purposes and world design – creating the next Call of Duty. Our recent research showed a massive oversupply of graduates in this industry, with more than 2,500 people fighting for just 930 jobs. On the other hand, we found a severe lack of data scientists. We have heard for some time about data being the new oil but the business of using scientific methods, processes, algorithms and systems to extract knowledge and insights from data is poorly served across the UK. In our study, there were a paltry 400 places on degree courses to produce graduates for more than 8,600 advertised jobs.
One of the biggest problems in combatting this discrepancy is the issue it creates further down the timeline. Once a fall in numbers has been identified, it takes several years before the education and training system can produce effective and trained workers to supplement numbers.
Data will therefore play a more important role than ever in removing the fog around our employment figures and giving our governing bodies an accurate reflection of their resources. After all, a chain is only as strong as its weakest link, and high retention rates mean nothing if graduate skillsets remain under-utilised. Leaders must adopt a meaningful, data-led approach to ensure we are connecting our educational offerings to today’s employer demand, rather than remain placated by misleading figures that will allow underlying systemic flaws to subsist. That way, we can start to strategically re-align our skills economy and move the conversation forwards towards a real, actionable solution.